DRAM chipmaker Nanya Technology Corp (南亞科技) yesterday posted a 79 percent quarterly decline in net profit, which it blamed on price declines and a surtax on undistributed earnings.
A non-operating loss of NT$457 million (US$14.25 million) by Inotera Memories Inc (華亞科技), its venture with US-based Micron Technology Inc, also weighed on the bottom line, the company said.
Net profits plunged from NT$1.85 billion in the first quarter to NT$397 million after paying a surtax on undistributed earnings of NT$765 million. On an annual basis, net profits dipped 91 percent from NT$4.25 billion.
Pre-tax profits shrank at a slower rate of 23.6 percent to NT$3.16 billion last quarter from the previous quarter’s NT$4.14 billion, according to the company’s financial statement.
Listed companies in Taiwan are required to pay a 10 percent surtax on undistributed earnings. The tax is usually imposed on second quarter financial results after shareholders approve earnings distribution plans.
Gross margin fell to 28.4 percent last quarter from 32.7 percent in the first quarter due to a 4.5 percent decline in average selling prices, company data showed.
Nanya president Lee Pei-ing (李培瑛) said that net profits would improve in the third quarter.
Price declines in DRAM chips for consumer electronics such as set-top boxes are decelerating and those for PC DRAM chips are rebounding, he said.
“Overall, the third quarter will be a stable period compared with the second quarter,” Lee said. “We believe we are moving toward a resilient fourth quarter.”
The optimism was based on seasonal demand for DRAM chips used in TVs, increasing DRAM content in mobile phones and increasing demand for servers, he said.
Nanya has budgeted NT$25.2 billion for capital spending this year, mostly on migrating to 20 nanometer technology.
As for Micron’s plan to acquire the remaining 67 percent stake in Inotera, “we are making progress. We will provide updates later this year,” Lee said.
Micron originally planned to wrap up the NT$130 billion acquisition deal this month by buying Inotera shares from Nanya and other members of Formosa Plastics Group (台塑集團).
As part of the deal, Nanya could subscribe to an unspecified amount of Micron shares or convertible bonds or cash.
The deal also includes next-generation technology transfer from Micron.
Ryanair, Transavia, Volotea and other low-cost airlines are feeling the financial pain from high jet fuel prices as a result of the Middle East war and are cutting flights. The closure of the Strait of Hormuz has taken a huge chunk of oil supplies off the market, sending the price of jet fuel soaring and triggering fears of shortages that could force airlines to cancel flights. Airlines are not waiting for a lack of supplies to react. “Travel alert: Airlines are cutting thousands of flights right now,” Travel Therapy host Karen Schaler said in an Instagram reel this past weekend.
MANAGING RISKS: Taiwan has secured LNG sufficient to cover 95 percent of electricity demand for next month, UBS said, describing the government’s approach as proactive UBS Group AG has raised its forecast for Taiwan’s economic growth this year to 8 percent, up from 6.9 percent previously, and said expansion could reach as high as 8.6 percent if external energy shocks are avoided. The upgrade reflects a stronger-than-expected first-quarter performance and sustained momentum in artificial intelligence (AI)-driven exports, which UBS said are providing a firm foundation for growth despite geopolitical and energy risks. Taiwan’s GDP expanded 13.69 percent year-on-year in the first quarter, the fastest growth since the second quarter of 1987, the Directorate-General of Budget, Accounting and Statistics (DGBAS) reported on Thursday. On a seasonally
Shares of Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) have repeatedly hit new highs, but an equity analyst said the stock’s valuation remains within a reasonable range and any pullback would likely be technical. The contract chipmaker’s historical price-to-earnings (P/E) ratio has ranged between 20 and 30, Cathay Futures Consultant Co (國泰證期) analyst Tsai Ming-han (蔡明翰) told Central News Agency. With market consensus projecting that TSMC would post earnings per share of about NT$100 (US$3.17) this year, supported by strong global demand for artificial intelligence (AI) applications, and the stock currently trading at a P/E ratio of below 25, Tsai said the valuation
The US Department of Commerce last week ordered multiple chip equipment companies to halt shipments of certain tools to China’s second-largest chipmaker, Hua Hong Semiconductor Ltd (華虹半導體), its latest action to slow the country’s development of advanced chips, two people familiar with the matter said. The department sent letters to at least a handful of companies informing them of restrictions on tools and other materials destined for two Hua Hong facilities US officials believe make China’s most sophisticated chips, the people said. Top US chip equipment companies Lam Research Corp, Applied Materials Inc and KLA Corp, each of which has significant
RSS