Thu, Feb 09, 2012 - Page 11 News List

Winbond net loss widens in Q4 on slack demand

By Kevin Chen  /  Staff Reporter

Memorychip maker Winbond Electronics Corp (華邦電子) said yesterday its net loss widened in the fourth quarter because of falling average selling prices and weak global demand for PCs and mobile phones.

However, the company said profitability was expected to recover gradually this year, as it would place increasing focus on special DRAM and flash memory chips that have better margins.

“Winbond will continue to focus on low to medium-density memory products and enhancement of product competitiveness with technology migration,” the Hsinchu-based company said in a statement, adding that it would also develop various new product lines this year.

The company’s 46-nanometer (nm) process DRAM and 58nm process flash product are expected to enter mass production this year to further improve its price competitiveness, it said.

“The flash product line will have small factor package products to expand the market share in networking applications and handheld devices, plus the development of NAND flash,” the company said.

Winbond said it plans to release NAND flash at the end of this year and the beginning of next year. As for specialty DRAM, the company said it expects a gradual recovery in demand for hard disk drives during the first half to enable it to improve the specialty DRAM product mix to pursue stable profitability.

For mobile RAM, the company said it would embark on 46nm process product development, strengthen its medium-density, low-power DRAM product for peripheral module products and handheld device applications, as well as increase revenue of high-density pseudo SRAM.

For the three months ended Dec. 31, the company said it had a net loss of NT$1.19 billion (US$40.3 million), widening from a loss of NT$41.11 million in the previous quarter and compared with a net profit of NT$30 million in the year-earlier period. Fourth-quarter revenue fell 17 percent quarter-on-quarter and dropped 26 percent year-on-year to NT$5.72 billion.

By product categories, specialty DRAM accounted for 47 percent of last quarter’s sales, followed by NOR flash’s 37 percent and mobile RAM’s 14 percent, the statement said.

“Winbond’s fourth-quarter revenue and profits declined due to flood damage in Thailand, which brought negative impact on the hard disk drive supply chain, price erosion, and weak demand for personal computers, TVs and features phones,” the statement said.

For the whole of last year, Winbond reported a net loss of NT$843 million, or loss per share of NT$0.23. In 2010, the company saw a net income of NT$3.55 billion, or earnings per share of NT$0.97. Cumulative revenue totaled NT$27.21 billion last year, down 15 percent year-on-year.

Winbond shares rose 2.55 percent yesterday to NT$5.62 ahead of the release of its latest financial results.

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