Fri, Oct 28, 2011 - Page 12 News List

Macronix profits plunge, but outlook encouraging

By Lisa Wang  /  Staff Reporter

Macronix International Co Ltd (旺宏電子), which supplies memory chips to Japanese game console maker Nintendo Co, yesterday said net profits plunged 87 percent year-on-year in the last quarter after factory utilization fell to lower than the chipmaker’s previous estimate because of an unstable ramp at a new factory.

Factory utilization fell to 79 percent in the third quarter, missing the chipmaker’s target of 90 percent. That also brought down the operating profit margin to 7 percent, lower than the company’s forecast of between 8 percent and 12 percent.

CONTRACTED

Net income in the third quarter contracted to NT$359 million (US$11.94 million), down from NT$2.76 billion a year ago. On a quarterly basis, net profits decreased 30 percent from NT$515 million.

This quarter, revenues are expected to grow about 20 percent to between NT$7.8 billion and NT$8 billion from NT$6.5 billion, Macronix forecast.

“After six months in the doldrums in the game console market, we are now seeing encouraging signs,” Macronix chairman Miin Wu (吳敏求) said during a teleconference.

ROM CHIPS

“Shipments of ROM chips will grow significantly this quarter from the third quarter,” he said.

ROM chips, used in game consoles, made up 90 percent of Macronix’s revenues last quarter.

However, flash memory chips would be flat this quarter, Wu said. NOR flash chips are non-volatile computer storage chips used in laptop computers, digital cameras and mobile phones.

RECOVER

Factory usage is expected to recover to 85 percent in the final quarter of the year, after a new 12-inch plant went back to its original schedule, the chipmaker said.

Operating profit margin is expected to improve to between 10 percent and 12 percent and gross margin should be flat or increase to 33 percent from 31 percent last quarter, the firm said.

Macronix’s new plant now produces 17,000 12-inch wafers a month, up from 10,000 wafers in the first half of this year.

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