Local electronics component maker Lite-On Technology Corp (光寶科技) yesterday said it was on track to lift its operating margin in the second half of the year, thanks to rising demand for its main products — such as power supplies — in the traditional high season.
“Our operating margin is improving in the second quarter, helped by better cost control and operation efficiency. We expect the margin to trend up further in the second half of the year,” said Julia Wang (王玉玲), director of Lite-On’s investor and public relations division.
“The first quarter is the trough,” Wang said. “The operation of our subsidiaries and core businesses are trending up this quarter.”
Lite-On made the remarks after reporting disappointing first-quarter earnings in late April.
Wang said the Japanese unit would not be reporting massive foreign exchange losses this quarter after Lite-On booked NT$300 million (US$9.6 milliion) in losses from the unit in the first quarter.
However, Lite-On also said revenues would fall drastically in the fourth quarter after it sells a PC monitor manufacturing unit to local laptop computer maker Wistron Corp (緯創) at the end of this month. The PC monitor unit made up around 45 percent of Lite-On’s overall revenues last year.
To seek further growth, Lite-On is looking into new acquisition deals, Wang said. Lite-On plans to raise more than NT$10 billion later this year by arranging syndicated bank loans to repay debts and to pave the way for new acquisition deals, Wang said.
On April 30, Lite-On told investors that it aimed to lift its operating margin to between 2.3 percent and 2.8 percent helped by rising demand for its power supply and new LED chip packaging business, compared with 2.1 percent in the first three months of the year.
Lite-On is scheduled to release its second quarter earnings and to give its outlook for the third quarter on Aug. 28.
Lite-On made NT$638 million in earnings, or NT$0.3 per share, for the first three months of the year, down 63 percent from NT$1.74 billion, or NT$0.6 a share, in the same period last year.
The company blamed the lackluster earnings results on a fire at a Chinese plant, rising labor costs in Chinese operations, climbing raw material prices and additional spending on employee bonuses.
DECOUPLING? In a sign of deeper US-China technology decoupling, Apple has held initial talks about using Baidu’s generative AI technology in its iPhones, the Wall Street Journal said China has introduced guidelines to phase out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) from government PCs and servers, the Financial Times reported yesterday. The procurement guidance also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic options, the report said. Chinese officials have begun following the guidelines, which were unveiled in December last year, the report said. They order government agencies above the township level to include criteria requiring “safe and reliable” processors and operating systems when making purchases, the newspaper said. The US has been aiming to boost domestic semiconductor
Nvidia Corp earned its US$2.2 trillion market cap by producing artificial intelligence (AI) chips that have become the lifeblood powering the new era of generative AI developers from start-ups to Microsoft Corp, OpenAI and Google parent Alphabet Inc. Almost as important to its hardware is the company’s nearly 20 years’ worth of computer code, which helps make competition with the company nearly impossible. More than 4 million global developers rely on Nvidia’s CUDA software platform to build AI and other apps. Now a coalition of tech companies that includes Qualcomm Inc, Google and Intel Corp plans to loosen Nvidia’s chokehold by going
ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to