Vanguard International Semiconductor Corp (世界先進), a local maker of chips used in computer and television displays, yesterday reported a profit for the third consecutive quarter.
Last quarter, Vanguard earned NT$87 million (US$2.72 million), compared with losses of NT$526 million in the fourth quarter of 2008. However, on a quarterly comparison basis, the results represented a decline of 87 percent as customers reduced orders amid inventory digestion.
This quarter, the company expected to regain growth momentum as customers rebuild inventory ahead of the Lunar New Year shopping season, a new-wave of home appliance stimulus packages in China, as well as promotional sales in Europe and the US.
“We are seeing strong demand from customers this quarter and customers are optimistic about the second quarter,” company president Leuh Feng (方略) told an investor conference.
“The demand for driver ICs used in TVs, monitors, notebooks and Chinese non-branded handsets look quite good,” Feng said.
The strong first quarter bodes well for the rest of the year on the back of growing corporate PC replacement and customers’ anticipation of robust TV sales in China, company chairman Chang Ching-chu (章青駒) told reporters on the sidelines of an investor conference.
“The market demand looks quite good this year, so we are planning to expand capacity. Customers are forecasting strong demand,” Chang said. “Our major customers are focusing on the expanding Chinese [TV] market.”
Vanguard said it planned to double capital spending this year to as high as NT$2 billion from last year’s budget of less than NT$1 billion, taking its cue from major shareholder Taiwan Semiconductor Manufacturing Corp (TSMC, 台積電). Vanguard supplies around a third of its output to TSMC.
Vanguard generated 57 percent of its overall revenues of NT$3.12 billion last quarter from display driver ICs.
Reflecting the vigorous demand this quarter, capacity utilization may rebound to 75 percent from 56 percent in the fourth quarter of last year, Vanguard said.
That would translate into 25 percent shipment growth from last quarter’s 214,000 8-inch-equivalent wafers, it said.
Gross margin may bounce back to between 14 percent and 16 percent, up from 11 percent last quarter on better factory usage, it said.
The gross margin forecast surpassed HSBC Securities’ forecast of 6.2 percent. HSBC earlier this month downgraded Vanguard to neutral, saying the stock has rallied over the past month and offers limited return for investors.
Shares of Vanguard fell 0.97 percent to NT$15.35 yesterday, underperforming the benchmark TAIEX, which slid 0.7 percent.
SEEKING CLARITY: Washington should not adopt measures that create uncertainties for ‘existing semiconductor investments,’ TSMC said referring to its US$165 billion in the US Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) told the US that any future tariffs on Taiwanese semiconductors could reduce demand for chips and derail its pledge to increase its investment in Arizona. “New import restrictions could jeopardize current US leadership in the competitive technology industry and create uncertainties for many committed semiconductor capital projects in the US, including TSMC Arizona’s significant investment plan in Phoenix,” the chipmaker wrote in a letter to the US Department of Commerce. TSMC issued the warning in response to a solicitation for comments by the department on a possible tariff on semiconductor imports by US President Donald Trump’s
The government has launched a three-pronged strategy to attract local and international talent, aiming to position Taiwan as a new global hub following Nvidia Corp’s announcement that it has chosen Taipei as the site of its Taiwan headquarters. Nvidia cofounder and CEO Jensen Huang (黃仁勳) on Monday last week announced during his keynote speech at the Computex trade show in Taipei that the Nvidia Constellation, the company’s planned Taiwan headquarters, would be located in the Beitou-Shilin Technology Park (北投士林科技園區) in Taipei. Huang’s decision to establish a base in Taiwan is “primarily due to Taiwan’s talent pool and its strength in the semiconductor
An earnings report from semiconductor giant and artificial intelligence (AI) bellwether Nvidia Corp takes center stage for Wall Street this week, as stocks hit a speed bump of worries over US federal deficits driving up Treasury yields. US equities pulled back last week after a torrid rally, as investors turned their attention to tax and spending legislation poised to swell the US government’s US$36 trillion in debt. Long-dated US Treasury yields rose amid the fiscal worries, with the 30-year yield topping 5 percent and hitting its highest level since late 2023. Stocks were dealt another blow on Friday when US President Donald
UNCERTAINTY: Investors remain worried that trade negotiations with Washington could go poorly, given Trump’s inconsistency on tariffs in his second term, experts said The consumer confidence index this month fell for a ninth consecutive month to its lowest level in 13 months, as global trade uncertainties and tariff risks cloud Taiwan’s economic outlook, a survey released yesterday by National Central University found. The biggest decline came from the timing for stock investments, which plunged 11.82 points to 26.82, underscoring bleak investor confidence, it said. “Although the TAIEX reclaimed the 21,000-point mark after the US and China agreed to bury the hatchet for 90 days, investors remain worried that the situation would turn sour later,” said Dachrahn Wu (吳大任), director of the university’s Research Center for
RSS