Parade Technologies Ltd (譜瑞), a leading video display and interface IC supplier, is expecting sales to rise to between US$57.5 million and US$62.5 million this quarter, compared with last quarter’s US$46.85 million.
The sales guidance estimates increases of 22.73 percent to 33.4 percent from last quarter, which is better than market expectations for an increase of between 15 percent and 27 percent, as the company is set to gain more orders for its embedded DisplayPort (eDP) solutions from clients.
The fabless IC designer is the sole supplier of eDP solutions for Apple Inc’s iPad Air and iPad Mini with Retina tablets. Its products are also increasingly being used in non-Apple notebook computers and tablet devices.
“The third quarter is typically a hot season for PC-related products and this year it is particularly hot for commercial notebooks,” Parade Technologies chief executive Jack Zhao (趙捷) said in a conference call with analysts on Thursday.
Zhao said the company sees incremental demand for eDP timing controllers in the notebook and tablet markets this quarter as clients continue resolution migration.
“Resolution is the keyword,” he said.
Among all notebooks, the adoption rate of eDP timing controllers is expected to reach 37 percent by the end of this year, Zhao said.
That figure will rise to above 50 percent next year, Zhao added, saying that a leading South Korean panel maker has become more aggressive on eDP panels for notebook computers, given lower power consumption. He did not name the company.
For this quarter, the firm expects its gross margin to be stay between 40 percent and 43 percent, with operating expenses between US$10.25 million and US$11.25 million, company spokesman Chang Yo-ming (張佑銘) said.
Yuanta Securities Corp (元大證券) analyst Steve Huang (黃柏璁) said in a research note yesterday that Parade Technologies benefits from a strong near-term momentum of eDP timing controllers for commercial notebooks, MacBook Pro laptops and iPad Air 2 and iPad Mini with Retina tablets.
Yuanta forecast that the company would report earnings per share of NT$5 this quarter, up 36 percent from last quarter.
In the long term, the company is expected to see strength in its new technologies, such as scalable intrapanel interface source driver chips for notebook and tablet computers, mobile industry processor interfaces and eDP solutions for smartphones, as well as repeaters for USB 3.1 and Type-C applications, he said.
Zhao said he expects to begin volume production of scalable intrapanel interface source driver chips beginning this quarter, although they would not be a huge revenue driver for the company in the near term.
Meanwhile, Zhao said the company’s display chips are experiencing tightened capacity at foundry companies’ 8-inch fabs, but the impact should be limited because Parade Tebhnologies has maintained good relationships with foundry firms and also because the company has upgraded many of its chip products to 12-inch fabs.
In the second quarter, the firm said its net income on a consolidated basis increased 133.15 percent year-on-year and 8.4 percent quarter-on-quarter to US$9.2 million, or earnings per share of US$0.13.
Revenue last quarter rose 72.48 percent year-on-year and 5.2 percent quarter-on-quarter to US$46.85 million, well above the company’s US$42 billion to US$46 billion guidance, due to better-than-expected eDP solutions demand for notebook computers.
Gross margin fell slightly by 0.03 percentage points to 41.47 percent, while operating margin was down 0.5 percentage points to 20.6 percent, company data showed.
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