With chip prices still below cost and demand frozen on the economic recession and oversupply, Powerchip Semiconductor Corp (力晶半導體), the nation’s biggest computer memory chipmaker, yesterday said it was cutting production further in a bid to slow cash outflow.
Two weeks ago, the dynamic random access memory (DRAM) manufacturer said it had halved output in the first quarter from its full production capacity.
“We are cutting more output as long as chip prices are still lower than cost levels,” company spokesman Eric Tan (譚仲民) said by phone yesterday, declining to detail its factory utilization.
PHOTO: CNA
Powerchip hoped to stem cash outflow by making less chips, a company exchange filing said.
The company has adjusted payment terms with its raw material suppliers, who have given Powerchip their support, Tan said in the filing, without giving financial details.
The chipmaker’s comments came after the Chinese-language Apple Daily reported yesterday that Powerchip had accelerated output reduction by cutting 80 percent of its production capacity and delaying old bill payments totaling NT$10 billion (US$300 million) to raw material suppliers to stave off fast cash outflow ahead of the maturity of the US$158 million outstanding convertible bonds in mid-June.
In addition, Powerchip said last month that it was in talks with credit banks to grant a final approval to a six-month extension to its bank loans, probably more than NT$63 billion as speculated.
Powerchip had losses of NT$32.03 billion in the first three quarters of last year and has incurred NT$133.57 billion in debts as of the third quarter of last year, its financial statement showed.
Shares of Powerchip plunged by almost the 7 percent daily limit — 6.88 percent — to NT$4.47 yesterday on mounting fears the company might follow in the steps of local smaller rival ProMOS Technologies Inc (茂德科技) in experiencing financial problems.
Late last month, ProMOS obtained the approval of a majority of bond holders to repay its debt at a 75 percent discount, but it was forced to push back the transaction as it was still struggling to obtain NT$3 billion in additional bank loans to make the payment.
The stock prices of ProMOS and the nation’s second-largest DRAM supplier, Nanya Technology Corp (南亞科技), declined by 6.67 percent and 6.31 percent to NT$1.4 and NT$7.43 respectively.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
Apple Inc has been developing a homegrown chip to run artificial intelligence (AI) tools in data centers, although it is unclear if the semiconductor would ever be deployed, the Wall Street Journal reported on Monday. The effort would build on Apple’s previous efforts to make in-house chips, which run in its iPhones, Macs and other devices, according to the Journal, which cited unidentified people familiar with the matter. The server project is code-named ACDC (Apple Chips in Data Center) within the company, aiming to utilize Apple’s expertise in chip design for the company’s server infrastructure, the newspaper said. While this initiative has been
GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said that revenue would rise moderately in the second half of this year, driven primarily by robust demand for advanced wafers used in high-bandwidth memory (HBM) chips, a key component of artificial intelligence (AI) technology. “The first quarter is the lowest point of this cycle. The second half will be better than the first for the whole semiconductor industry and for GlobalWafers,” chairwoman Doris Hsu (徐秀蘭) said during an online investors’ conference. “HBM would definitely be the key growth driver in the second half,” Hsu said. “That is our big hope
The consumer price index (CPI) last month eased to 1.95 percent, below the central bank’s 2 percent target, as food and entertainment cost increases decelerated, helped by stable egg prices, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday. The slowdown bucked predictions by policymakers and academics that inflationary pressures would build up following double-digit electricity rate hikes on April 1. “The latest CPI data came after the cost of eating out and rent grew moderately amid mixed international raw material prices,” DGBAS official Tsao Chih-hung (曹志弘) told a news conference in Taipei. The central bank in March raised interest rates by