TPK Holding Co Ltd (宸鴻), one of Apple Inc’s touch panel suppliers, missed its third-quarter revenue target after posting a weaker-than-expected 12.7 percent monthly growth figure for revenue last month amid lukewarm customer demand.
Revenue rose to NT$10.639 billion (US$362 million) last month, compared with August’s NT$9.443 billion, according to a company statement. However, that represented a 22.2 percent contraction, from NT$13.668 billion in the same month last year.
TPK originally expected revenue to rebound notably last month, saying that demand from tablet makers would pick up first in preparation for holiday sales during the current quarter.
In the quarter ending last month, TPK’s revenue plunged 23 percent to NT$29.467 billion, from NT$38.285 billion in the second quarter, marking the weakest quarterly revenue in about two years.
TPK had forecasted in August that revenue would shrink by between 15 percent and 20 percent last quarter, citing sluggish demand for high-end smartphones, tablets and slow adoption of notebook computers with touch features.
Earnings per share is expected to more than halve to between NT$3 and NT$4 last quarter, from NT$9.02 a share in the second quarter, an analyst said, citing a consensus estimate. The analyst declined to be named.
TPK said the fourth quarter would be better than the third quarter, supported by seasonal demand. The company is scheduled to release third-quarter earrings and a business outlook on Oct. 30.
In August, the touch panel maker cut its capital spending this year by 16 percent to NT$25 billion, from its previous estimate of NT$30 billion, to cope with slowing demand.
TPK shares surged 2.92 percent to NT$282 yesterday, boosted by its announcement on Thursday that it is forming a strategic partnership with Japan’s Nissha Printing Co to tap into the middle-end smartphone market. The partnership would speed up commercialization of a new touch panels for middle-end smartphones, the company said.