- Company bets on 8-inch hybrid bonding to break long-standing chip yield constraints
- Funding to support Ningbo production line as AR and automotive demand builds
Micro LED display startup Qiushui Semiconductor (秋水半导体) has raised nearly 200 million yuan ($30 million) in combined Pre-Series A and Series A financing, as investors step up bets on next-generation display technologies seen as critical to AR devices and advanced automotive lighting.
The round, disclosed on May 29, was led by Aurora Capital with participation from regional investors including Ningbo Tongshang Fund, Shanghai Sharewin Equity Investment and Ningbo Talent Development Fund.
Qiushui plans to use the proceeds to build an 8-inch hybrid bonding production line in Ningbo High-Tech Zone and fund further research and development.
Founded in November 2022 and originally based in Suzhou before relocating to Ningbo in February this year, Qiushui develops Micro LED display chips and modules for applications including automotive digital lighting, AR glasses and micro-projectors.
Manufacturing bottlenecks
The investment comes as Micro LED technology continues to face manufacturing bottlenecks at the chip level, despite growing downstream demand.
IDC data show global shipments of AR/VR headsets and smart glasses without displays exceeded 14 million units in 2025, while display-equipped AR glasses remained below one million units.
In automotive lighting, analysts at TrendForce estimate adaptive driving beam headlight penetration could reach 21.6% by 2029, with manufacturers such as Porsche already adopting Micro LED-based pixel headlight systems.
However, scaling production has remained constrained by yield and efficiency challenges in chip fabrication.
Non-destructive chip architecture
Qiushui said its approach avoids direct etching of light-emitting materials, instead using a non-destructive chip architecture combined with 8-inch silicon substrates and 3D hybrid bonding.
The startup claims this can lift chip yields to above 99.99%, narrow light emission angles from ±60 degrees to ±10 degrees, and extend operating temperature ranges from below 50°C to above 140°C.
Zhang Yue, founding partner of the lead backer Aurora Capital, said the approach represents a “fundamental shift” in chip design and could lay the groundwork for what he described as an “iPhone moment” for AI glasses.
The company has already developed a 0.61-inch digital automotive lighting chip and completed customer sampling validation. A single-color green AR chip is also scheduled for mass shipment this year.
“Green monochrome chips could already support use cases such as swimming goggles, teleprompters, translation devices and in-car navigation,” founder and chief executive Jiang Zhenyu said.
The next frontier: Full-color display
Meanwhile, he predicted that global shipments of display-enabled AI glasses could rise from around 400,000–500,000 units today to “tens of millions” within a year.
Jiang added that the industry’s next phase depends on solving full-color Micro LED production, noting that red light chips remain particularly challenging due to severe efficiency losses under conventional etching processes.
“To reach the ‘iPhone moment’ for Micro LED, colorization is essential,” said Jiang, who received his doctorate in condensed matter physics from the University of Pennsylvania. “Our non-destructive process is the key to unlocking that step.”
10 million chips a year
Qiushui is currently building an 8-inch hybrid bonding production line in Ningbo, expected to come online in October.
The facility is designed to produce around 1,000 wafers per month, equivalent to annual output capacity of more than 10 million Micro LED chips.
