Macronix International Co (旺宏電子), which supplies read-only memory (ROM) chips to Japan’s Nintendo Co, yesterday said that its net profit more than tripled sequentially to NT$616 million (US$20.29 million) last quarter, as a persistent supply crunch boosted prices and factory utilization.
Last quarter was the fourth straight profitable quarter for the chipmaker. It made NT$203 million in the first quarter of this year, while it lost NT$689 million in the second quarter of last year on heavy depreciation costs.
Gross margin climbed to 34 percent last quarter from 27 percent in the first quarter, hitting the highest level in about five years, the Hsinchu-based memorychip manufacturer said.
Macronix expects its growth momentum to further pick up speed in the second half as the consumer electronics industry enters its peak season, which will only aggravate supply constraints.
“Client orders far exceed what we can supply,” Macronix president Lu Chih-yuan (盧志遠) told investors, adding that the company has to allocate capacity among its NOR and NAND flash memorychip customers because its factories are already running at full capacity.
“We have built a large stockpile for our major client in the second quarter ahead of the peak season in the third quarter,” Lu said.
Macronix stocked NT$9.08 billion worth of memory chips last quarter, mostly ROM chips for Nintendo, as the game console supplier is scheduled to launch new game titles next quarter to fuel sales of its already popular game console — the Nintendo Switch.
Robust customer demand should help drive chip prices at a faster pace in the second half than in the first half, Lu said.
Macronix is optimistic that the demand could extend into next year, which should benefit the company given its technological edge and position in the NOR memorychip market and a likely prolonged supply constraint, especially with Toshiba Corp and Micron Technology Inc exiting the NOR flash market.
“We are positive about ROM, NOR and NAND [demand] next year,” Lu said. “We do not see any indicators of overshooting this outlook.”
Macronix expects its market share to expand from 26 percent to 30 percent of the global NOR flash memory market.
NOR flash accounted for 63 percent of the company’s overall revenue of NT$6.56 billion last quarter.
To satisfy customer demand, Macronix plans to spend NT$1.79 billion on new equipment for advanced chips this year. That would bring its total capital spending this year to about NT$4 billion, the company said.
The additional investment will be used to upgrade production of 4,800 high-end wafers a month, the chipmaker said.
Total capacity would remain unchanged, he said.
The government yesterday approved applications by Alphabet Inc’s Google to invest NT$27.08 billion (US$859.98 million) in Taiwan, the Ministry of Economic Affairs said in a statement. The Department of Investment Review approved two investments proposed by Google, with much of the funds to be used for data processing and electronic information supply services, as well as inventory procurement businesses in the semiconductor field, the ministry said. It marks the second consecutive year that Google has applied to increase its investment in Taiwan. Google plans to infuse NT$25.34 billion into Charter Investments Ltd (特許投資顧問) through its Singapore-based subsidiary Fructan Holdings Singapore Pte Ltd, and
SECOND-RATE: Models distilled from US products do not perform the same as the original and undo measures that ensure the systems are neutral, the US’ cable said The US Department of State has ordered a global push to bring attention to what it said are widespread efforts by Chinese companies, including artificial intelligence (AI) start-up DeepSeek (深度求索), to steal intellectual property from US AI labs, according to a diplomatic cable. The cable, dated Friday and sent to diplomatic and consular posts around the world, instructs diplomatic staff to speak to their foreign counterparts about “concerns over adversaries’ extraction and distillation of US AI models.” Distillation is the process of training smaller AI models using output from larger, more expensive ones to lower the costs of training a powerful new
Micron Technology Inc is a driving force pushing the US Congress to pass legislation that would put new export restrictions on equipment its Chinese competitors use to make their chips, according to people familiar with the matter. A US House of Representatives panel yesterday was to vote on the “MATCH Act,” a bill designed to close gaps in restrictions on chipmaking equipment. It would also pressure foreign companies that sell equipment to Chinese chipmaking facilities to align with export curbs on US companies like Lam Research Corp and Applied Materials Inc. The bill targets facilities operated by China’s ChangXin Memory Technologies Inc
Singapore-based ride-hailing and delivery giant Grab Holdings’ planned acquisition of Foodpanda’s Taiwan operations has yet to enter the formal review stage, as regulators await supplementary documents, the Fair Trade Commission (FTC) said yesterday. Acting FTC Chairman Chen Chih-min (陳志民) told the legislature’s Economics Committee that although Grab submitted its application on March 27, the case has not been officially accepted because required materials remain incomplete. Once the filing is finalized, the FTC would launch a formal probe into the deal, focusing on issues such as cross-shareholding and potential restrictions on market competition, Chen told lawmakers. Grab last month announced that it would acquire
RSS