TSMC’s fourth-quarter profit plunged 64 percent to NT$12.45 billion from NT$34.48 billion a year earlier, while UMC posted record quarterly losses of NT$23.51 billion in the fourth quarter.
But, there were warning signs that a slight recovery in stock replenishment demand may not be strong enough to support the companies’ expectations of a near-term revival, while such unconventional booking seen recently could turn out to be a burden to inventory management if end demand fails to pick up later this year.
“The rate of the recovery and the sustainability of some spot upticks we have seen in the supply chain are still in question, and end-demand dependent, which is suspect at best,” said Randy Abrams, a semiconductor analyst with Credit Suisse, said in a report dated Tuesday.
Local notebook computer maker Pegatron Corp (和碩), a spinoff PC manufacturing unit of EeePC maker Asustek Computer Inc (華碩), said it could be a challenge for most electronics assemblers to cope with rush orders as they must have great flexibility in component stock and labor force management, the Commercial Times reported on Friday, citing the company’s spokesperson Denese Yao (姚德慈).
Being realistic this time, Taiwanese electronic companies remain focused on cost-saving measures as they become more cautious about the recent order pickup. Chi Mei, for instance, plans to launch a structural adjustment to enhance operation efficiency and profitability, rather than capacity expansion and market share gain. The new plan is set to take effect on March 1.
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