Wed, Oct 28, 2015 - Page 13 News List

SPIL says 6.14% decline in annual revenue expected

By Lisa Wang  /  Staff reporter

Siliconware Precision Industries Inc (SPIL, 矽品精密), the world’s No. 4 chip packager and tester, expects revenue to drop 6.14 percent sequentially to NT$18.8 billion (US$575.4 million) this quarter, as customers are cautious about placing orders amid prolonged inventory correction.

The weakness reflects the semiconductor industry’s slump this quarter, with “all segments to trend down in the fourth quarter,” SPIL chairman Bough Lin (林文伯) told a teleconference yesterday.

The semiconductor industry will remain soft in the current quarter as the Chinese and European economies fell short of expectations, and demand for smartphones in emerging markets slows, Lin said.

“Supply chain inventory did not improve significantly in the third quarter, with sales of mobile phones, PCs and TVs all weaker than expected,” Lin said. “Inventory digestion will extend into the fourth quarter before it returns to normal levels in the first quarter” of next year.

SPIL expects to receive many orders next quarter after excessive inventory is digested, Lin said.

This year, the global semiconductor industry will contract slightly in terms of revenue, before regaining an annual growth of a single-digit percent next year, Lin said.

The chip packaging and testing sector will grow mildly this year from last year, out-performing the overall semiconductor industry, Lin said.

SPIL said it expects revenue to fall to between NT$18.8 billion and NT$20 billion this quarter, compared with NT$20.03 billion last quarter.

Gross margin will be in a range from 23 percent to 25 percent this quarter, compared with 24.7 percent last quarter, SPIL said.

Early this month, SPIL posted a 27.17 percent decline in net income for last quarter at NT$2.68 billion, compared with NT$3.68 billion the prior quarter. On an annual basis, the figure represented a 17.79 percent decline from NT$3.26 billion.

SPIL said it would continue to collaborate with Hon Hai Precision Industry Co Ltd (鴻海精密) to expand its system-in-a-package business, but it will not swap shares with Hon Hai.

SPIL expects its SiP business to contribute US$130 million in revenue next year and the figure to climb to US$700 million in 2017.

Separately, DRAM memory chipmaker Inotera Memories Inc (華亞科技) posted 26 percent growth in quarterly net profit for last quarter, supported by a massive foreign-exchange gain.

Net profit grew to NT$5.77 billion last quarter, compared with NT$4.59 billion in the previous quarter. Inotera booked NT$2.65 billion in foreign exchange gains last quarter, reversing foreign-exchange losses of NT$521 million in the second quarter.

Operating income shrank 32 percent to NT$3.86 billion last quarter from NT$5.67 billion in the previous quarter.

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