Powerchip Semiconductor Corp (
Looking ahead, despite an expected downtrend in chip prices, Powerchip chairman Frank Huang (
But, turning more conservative than three months ago, Huang said prices for memory chips may slide to US$3.2, or US$3.3 per unit on the spot market this year.
He also expected a price correction on servers in the next quarter during the annual seasonal slowdown. Chip prices were likely to tumble by about a quarter to hit a historical low of US$3 a unit, he said.
But strong cost control puts Powerchip in a better position to outstrip its rivals, Huang said.
"We have the strongest cost-saving abilities in the DRAM [dynamic random access memory] industry," he said, adding that limited new production will also help bolster chip prices.
Powerchip will be able to save another 10 to 15 percent after it switches more production to advanced 0.11-micron technology, moving its cost to below the current US$2 per unit, Huang said.
But a 7 percent decline in chip prices helped to shave a similar amount off of Powerchip's gross margin last quarter -- which fell to 42 percent, from 49 percent in the third quarter -- as did a 6 percent appreciation of the local currency versus the greenback.
During the three-month period to last month, Powerchip's earning's more than tripled to NT$5.8 billion, or NT$1.41 per share, compared to NT$1.8 billion a year earlier. Sales also surged 92 percent to NT$16.5 billion.
That brought the memory chipmaker's earnings for last year to NT$21.4 billion, or NT$5.63 a share, a big jump from NT$168.98 million, or NT$0.06, in 2003. Sales also soared to NT$57.44 billion, from NT$22.97 billion.
Despite the apparently brisk growth, Robert Lin (
"Chip prices were lower than I calculated," Lin said.
He expects sagging demand in the upcoming slow season to drive chip prices down to around US$3 per unit. But for this year, Lin said the speed of the transition from DDRI memory chips, which are used in most computers now, to faster DDRII chips, would be one of the most important factors affecting chip prices.
Powerchip expects DDRII memory chips to overtake DDRI as its mainstay product in the second half of this year and says it is ready for the technological transition.
Powerchip plans to spend NT$39 billion on new facilities this year, up from NT$29 billion last year, with a big portion of that amount going to the company's second advanced 300mm plant.
The new factory will help boost Powerchip's production by 60 percent this year compared to last year, according to Huang. The plant is scheduled to start mass production in the third quarter.
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
RECORD-BREAKING: TSMC’s net profit last quarter beat market expectations by expanding 8.9% and it was the best first-quarter profit in the chipmaker’s history Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), which counts Nvidia Corp as a key customer, yesterday said that artificial intelligence (AI) server chip revenue is set to more than double this year from last year amid rising demand. The chipmaker expects the growth momentum to continue in the next five years with an annual compound growth rate of 50 percent, TSMC chief executive officer C.C. Wei (魏哲家) told investors yesterday. By 2028, AI chips’ contribution to revenue would climb to about 20 percent from a percentage in the low teens, Wei said. “Almost all the AI innovators are working with TSMC to address the
FUTURE PLANS: Although the electric vehicle market is getting more competitive, Hon Hai would stick to its goal of seizing a 5 percent share globally, Young Liu said Hon Hai Precision Industry Co (鴻海精密), a major iPhone assembler and supplier of artificial intelligence (AI) servers powered by Nvidia Corp’s chips, yesterday said it has introduced a rotating chief executive structure as part of the company’s efforts to cultivate future leaders and to enhance corporate governance. The 50-year-old contract electronics maker reported sizable revenue of NT$6.16 trillion (US$189.67 billion) last year. Hon Hai, also known as Foxconn Technology Group (富士康科技集團), has been under the control of one man almost since its inception. A rotating CEO system is a rarity among Taiwanese businesses. Hon Hai has given leaders of the company’s six