Delta Electronics Inc (台達電), the nation’s top supplier of power supply units, on Tuesday reported weaker-than-expected sales for last month, their lowest since April, prompting a foreign brokerage to downgrade the company’s stocks amid worries of a deeper seasonal pullback.
Last month, Delta posted a consolidated revenue of NT$15.2 billion (US$517 million), down 6.45 percent from NT$16.25 billion in August, but up 3.27 percent from NT$14.72 billion a year earlier.
In the third quarter, the Taipei-based company’s consolidated revenue was NT$47.49 billion, an increase of 3.33 percent from the second quarter and up 6.6 percent from the year before.
Last quarter’s result was in line with the company’s forecast in August.
On Aug. 17, Delta chairman Yancey Hai (海英俊) told investors that he expected the third-quarter revenue to grow from the second quarter’s NT$45.96 billion, supported by rising demand for power supply units for servers and passive components for mobile devices, such as smartphones and tablets.
However, Credit Suisse analyst Pauline Chen (陳柏齡) said in a note released yesterday that Delta’s drop in sales for last month compared with August showed an “across-the-board weakness” in the company’s products, except data center and miniaturized components.
Chen said the brokerage now expected Delta to post a sequential decline of 9 percent in revenue for the fourth quarter, according to the note.
She also downgraded the stock to “neutral” from “outperform,” which had cited potential profit taking after Delta surged nearly 50 percent since the beginning of this year, outperforming the TAIEX, which has risen 7.35 percent over the period.
Shares in Delta closed at NT$108 on Tuesday, 4 percent lower than in the previous session, Taiwan Stock Exchange data showed. The market was closed yesterday for a holiday.
Unlike Delta, major local rival Lite-On Technology Corp (光寶科技) on Monday reported NT$10.82 billion in consolidated revenue for last month, up 4 percent month-on-month and 6 percent year-on-year, according to a company statement.
Last month’s result hit a record two-year monthly high, which Lite-On Technology attributed mainly to stable global end-demand for high-end servers, networking equipment and mobile devices for cloud computing applications.
The company said high-end camera modules, such as 8-megapixel modules for tablets, also contributed to its sales last month, which showed an increase of more than 10 percent from the same month last year, supported by its production capacity expansion, smooth delivery of high-end products and sequential gains in the global market share of smartphones and PCs.
In addition to substantial demand from branded customers and delivery growth, Lite-On’s revenue from LED lighting components increased about 900 percent year-on-year, helping the company’s optoelectronics revenue grow 15 percent from a year earlier.
As a result, the company said its third-quarter revenue increased 2 percent sequentially to NT$31.29 billion, while cumulative sales from January through last month totaled NT$89.39 billion, the same level as during the same period last year.
Additional reporting by Lisa Wang