Manufacturing revenue shrank 0.8 percent annually to NT$12.84 trillion (US$391.92 billion) in the first half of the year, dragged down by weaker-than-expected global smartphone demand and falling global crude oil prices, the Ministry of Economic Affairs said yesterday.
Revenue in the second half may be flattish or even decline from a year earlier because of a higher comparison base last year, the ministry said.
Last quarter alone, revenue dropped 2.9 percent to NT$6.46 trillion from a year earlier, as slowing smartphone demand negatively affected the sales performance of Taiwanese chip designers.
“Sales in the second quarter contracted on an annual basis for the first time in the past seven quarters,” Department of Statistics Deputy Director-General Yang Kuei-hsien (楊貴顯) said by telephone.
Global smartphone shipments are forecast to grow 10.4 percent to 1.44 billion units this year, down from last year’s 27.5 percent annual growth, International Data Corp said in its latest report, citing soft demand from China.
Yang said Taiwan’s panel industry also saw an annual decline in revenue last quarter, due to falling average selling prices and rising competition from China, Japan and South Korea.
The continual decline in global crude and stainless steel prices further contributed to falling revenues at Taiwanese petrochemical and steel companies, he said.
While the computer component, optical module and machinery sectors saw revenue rise last quarter, the scale of their growth was not enough to offset the sales drop in other manufacturing sectors, Yang said.
The computer component and optical module sector saw a 9.1 percent annual increase in sales to NT$2.14 trillion last quarter, fueled by robust demand for servers and the Apple Watch.
The machinery sector also grew mildly by 1.8 percent annually to NT$261.8 billion last quarter, thanks to demand from Taiwanese manufacturers building new plants in Southeast Asia, ministry data showed.
For this quarter, Yang said that manufacturing revenue would grow from last quarter, supported by the launches of Apple Inc’s new iPhones and other new products by global brands.
“The manufacturing industry’s revenue in the second half of the year would depend on the sales performance of Apple’s new iPhones,” he said.
HORMUZ ISSUE: The US president said he expected crude prices to drop at the end of the war, which he called a ‘minor excursion’ that could continue ‘for a little while’ The United Arab Emirates (UAE) and Kuwait started reducing oil production, as the near-closure of the crucial Strait of Hormuz ripples through energy markets and affects global supply. Abu Dhabi National Oil Co (ADNOC) is “managing offshore production levels to address storage requirements,” the company said in a statement, without giving details. Kuwait Petroleum Corp said it was lowering production at its oil fields and refineries after “Iranian threats against safe passage of ships through the Strait of Hormuz.” The war in the Middle East has all but closed Hormuz, the narrow waterway linking the Persian Gulf to the open seas,
Apple Inc increased iPhone production in India by about 53 percent last year and now makes a quarter of its marquee devices there, reflecting the US company’s efforts to avoid tariffs on China. The company assembled about 55 million iPhones in India last year, up from 36 million a year earlier, people familiar with the matter said, asking not to be named because the numbers aren’t public. Apple makes about 220 million to 230 million iPhones a year globally, with India’s share of the total increasing rapidly. Apple has accelerated its expansion in the world’s most populous country in recent years, bolstered
HEADWINDS: The company said it expects its computer business, as well as consumer electronics and communications segments to see revenue declines due to seasonality Pegatron Corp (和碩) yesterday said it aims to grow its artificial intelligence (AI) server revenue more than 10-fold this year from last year, driven by orders from neocloud solutions clients and large cloud service providers. The electronics manufacturing service provider said AI server revenue growth would be driven primarily by the Nvidia Corp GB300 server platform. Server shipments are expected to increase each quarter this year, with the second half likely to outperform the first half, it said. The AI server market is expected to broaden this year as more inference applications emerge, which would drive demand for system-on-chip, application-specific integrated circuits
A new worry has been rippling across the stock market lately: Entire businesses, not just their employees, might be thrown out of work. While most economists say fears of an artificial intelligence (AI) job apocalypse are overblown, seismic shifts have happened in the past after big tech breakthroughs. The IT revolution of the 1990s led to a surge in productivity that sped up the US economy for several years. It also rendered companies or even industries largely redundant — from travel agents and stockbrokers to classified advertising and newspapers, or video rental stores. Economists expect AI would deliver higher productivity,
RSS