TPK Holdings Co (宸鴻), which counts Apple Inc as its top client, yesterday said revenues could drop 15 percent sequentially next quarter due to a seasonal slowdown after the year-end holiday shopping spree.
A 15 percent quarterly decline would still be a good performance, said Ted Lynch, an analyst tracking the touch panel industry for Pro Standard Capital Management (禮正證券投顧).
“Visibility for the first quarter is not clear amid concern over the US fiscal cliff and Europe’s debt problem, which could impact on consumer spending,” TPK chief financial executive Freddie Liu (劉詩亮) told reporters on the sidelines of an investors’ conference arranged by Taiwan Stock Exchange Corp.
“However, we hope the first quarter will be in line with the seasonal pattern,” Liu said, forecasting a 15 percent decline because of the “seasonal correction.”
Customers will be reviewing their product lineup in the first quarter after the holiday shopping spree. TPK expects consumer takeup of touch-enabled laptops to pick up in the second and third quarters as prices drop, Liu said.
For this quarter, TPK should be able to achieve 30 percent quarterly revenue growth, as most analysts forecast, Liu said.
The increase would be driven mostly by demand for touch screens for new notebook computers running Microsoft Corp’s new Windows 8 system, he said.
That implies TPK could post a new revenue record of NT$46.32 billion (US$1.59 billion) this quarter, from last quarter’s NT$35.63 billion. Based on this uptrend, Liu said monthly revenue should rise further this month from last month’s NT$16.94 billion.
TPK said rising touch screen penetration rates in mobile devices and laptops would be its future growth drivers.
The company expects 20 percent of global notebook shipments next year to be outfitted with touch screens, Liu said.
“Based on robust retail sales figures during the Black Friday shopping season in the US, touch screens have become a must-have, rather than an option, for high-end electronics products,” Liu said.
To meet growing demand for touch panels used in laptops, TPK plans to invest NT$4 billion to build a 4.5-generation panel production line through its subsidiary Cando Corp (達鴻).
Cando is expected to ramp up production in the third quarter of next year, Liu said.
For next year, TPK has budgeted about US$500 million to US$600 million for buying new equipment. That would bring its monthly capacity to a maximum of 2 million touch panels, from 1 million units now, he said.
TPK rallied 5.65 percent yesterday to NT$458.50, outperforming the TAIEX’s 0.92 percent rise.