Taiwanese solar cell makers are expected to feel the pinch of sluggish demand this quarter as prices fall below cost amid deep cuts in government subsidies in Europe, a Taipei-based market researcher said in a weekly report.
However, local polysilicon suppliers and solar system installation service providers will be less affected by the industry slump and could remain profitable this quarter, TrendForce Corp (集邦科技) said on Wednesday.
INTO THE RED
Solar cell makers are expected to drift into the red this quarter as they bear the brunt of a sharp decline in demand and prices.
“The second quarter will be a trying period for solar cell companies because of lackluster prospects,” TrendForce said. “It is highly possible that the price will drop further to below US$1 per watt as there are no signs indicating a recovery soon after prices fell to near the cost level of US$1 per watt.”
To minimize price erosion, solar cell manufacturers such as Motech Industries Inc (茂迪), Gintech Energy Corp (昱晶) and Solartech Energy Corp (昇陽光電) have cut output to cope with sagging demand, driving down their factory usage to about 80 percent, which means higher cost per unit because of heavy equipment depreciation, the researcher said.
PRICES PLUNGE
TrendForce said the price of solar cells plunged 5.66 percent to an average of US$1.034 per watt this week from a week ago, with the lowest price hitting US$0.9 per watt. Prices had plunged 2.92 percent the previous week.
Motech, the nation’s biggest solar cell maker, said last week it expected solar prices to slide slightly this quarter from last quarter.
PROFITS DECLINE
The company reported its smallest quarterly profits for the first quarter at NT$680 million, a decline of 53 percent from the NT$1.46 billion profit in the final quarter of last year. Gross margin plummeted to 12.5 percent, the lowest in five quarters, from nearly 20 percent.
Shares of Motech, Gintech and Solartech yesterday dropped 1.4 percent, 2.59 percent and 4.21 percent respectively to NT$105.5, NT$75.2 and NT$63.7.
LIMITED IMPACT: Investor confidence was likely sustained by its relatively small exposure to the Chinese market, as only less advanced chips are made in Nanjing Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) saw its stock price close steady yesterday in a sign that the loss of the validated end user (VEU) status for its Nanjing, China, fab should have a mild impact on the world’s biggest contract chipmaker financially and technologically. Media reports about the waiver loss sent TSMC down 1.29 percent during the early trading session yesterday, but the stock soon regained strength and ended at NT$1,160, unchanged from Tuesday. Investors’ confidence in TSMC was likely built on its relatively small exposure to the Chinese market, as Chinese customers contributed about 9 percent to TSMC’s revenue last
With this year’s Semicon Taiwan trade show set to kick off on Wednesday, market attention has turned to the mass production of advanced packaging technologies and capacity expansion in Taiwan and the US. With traditional scaling reaching physical limits, heterogeneous integration and packaging technologies have emerged as key solutions. Surging demand for artificial intelligence (AI), high-performance computing (HPC) and high-bandwidth memory (HBM) chips has put technologies such as chip-on-wafer-on-substrate (CoWoS), integrated fan-out (InFO), system on integrated chips (SoIC), 3D IC and fan-out panel-level packaging (FOPLP) at the center of semiconductor innovation, making them a major focus at this year’s trade show, according
DEBUT: The trade show is to feature 17 national pavilions, a new high for the event, including from Canada, Costa Rica, Lithuania, Sweden and Vietnam for the first time The Semicon Taiwan trade show, which opens on Wednesday, is expected to see a new high in the number of exhibitors and visitors from around the world, said its organizer, SEMI, which has described the annual event as the “Olympics of the semiconductor industry.” SEMI, which represents companies in the electronics manufacturing and design supply chain, and touts the annual exhibition as the most influential semiconductor trade show in the world, said more than 1,200 enterprises from 56 countries are to showcase their innovations across more than 4,100 booths, and that the event could attract 100,000 visitors. This year’s event features 17
Hon Hai Precision Industry Co (鴻海精密), which assembles servers for Nvidia Corp, yesterday said that revenue last month rose 10.61 percent year-on-year, driven by strong growth in cloud and networking products amid continued front-loading orders for artificial intelligence (AI) server racks. Consolidated revenue expanded to NT$606.51 billion (US$19.81 billion) last month from NT$548.31 billion a year earlier, marking the highest ever in August, the company said in a statement. On a monthly basis, revenue was down 1.2 percent from NT$613.86 billion. Hon Hai, which is also a major iPhone assembler, added that its electronic components division saw significant revenue growth last month, boosted
RSS