Wed, Jan 07, 2015 - Page 14 News List

TPK reports slower-than-expected revenue growth

WEARABLES REVENUE:The company said that touchpanels for wearable devices were expected to generate about 10 percent of last year’s Q3 revenue

By Lisa Wang  /  Staff reporter

TPK Holding Co (宸鴻), which supplies touchpanels for Apple Inc’s Apple Watch, yesterday reported slower-than-expected 21.4 percent sequential growth in revenue for last quarter.

Revenue shrank from NT$13.38 billion (US$417.9 million) in November to NT$13.29 billion last month. The company’s revenue last quarter was NT$39.58 billion, compared with NT$32.61 billion the previous quarter.

However, the quarterly growth fell short of analysts’ expectations.

UBS Securities Ltd’s Taipei-based analyst Arthur Hsieh (謝宗文) forecast that TPK Holding would post 26 percent sequential growth in revenue to NT$41.5 billion in the quarter ending Wednesday last week.

The estimate was relatively conservative compared with the consensus estimate of a 37 percent quarterly expansion, Hsieh said.

In October last year, TPK Holding told analysts that revenue growth would be “healthy” in the final quarter of last year thanks to new product launches by its clients.

Smartphones, wearable devices and tablets would be the major items, TPK Holding said at the time.

Touchpanels for wearable devices were forecast to start generating revenue in the past quarter, with the contribution expected to be about 10 percent of the quarter’s revenue, TPK Holding said.

Industry observers expect the Apple Watch to hit the market early this year.

Even so, TPK Holding still faces potential risks such as lower-than-expected Apple Watch and demand for Internet-connected vehicles as well as market-share losses to competitors, analysts said.

A slower-than-expected pickup of touch-screen notebook computer penetration is another negative factor for the company’s business this year, they said.

TPK Holding said its consolidated revenue for all of last year contracted 18.6 percent to NT$129.52 billion from NT$159.07 billion in 2013.

The company’s shares plunged 2.31 percent to NT$190 yesterday, Taiwan Stock Exchange data showed.

They have risen 11.78 percent over the past 12 months, the data showed.

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