Adata Technology Co (威剛科技) yesterday posted a pre-tax profit of NT$2.42 billion (US$80.65 million) for the first 11 months of this year, as the world’s second-biggest memory module maker benefits from a super boom in the memory chip industry to surpass its share capital this year.
The figure exceeds the NT$1.61 billion in pre-tax profit that the company made during the whole of last year. After deducting tax, Adata earned NT$1.31 billion last year.
The strong growth momentum indicates that Adata is on course this year to post a net profit equal to its NT$2.3 billion in share capital.
“As the DRAM [industry] enters positive cycles in terms of demand and profitability, we believe that the world’s major DRAM chip suppliers will remain rational about capacity [expansion],” Adata chairman Simon Chen (陳立白) said in a statement earlier this month.
“Besides, there are no major plans on the horizon that would topple the industry’s ecosystem,” Chen added. “So we are positive about the DRAM market.”
Adata expects DRAM chip prices to continue to rise this quarter, extending a months-long uptrend, as reflected by active ordering from PC vendors and channel companies ahead of the year-end holiday shopping season, the company said.
DRAM chip prices are expected to climb 10 percent on average this quarter from last quarter as demand continues to outpace supply, following last quarter’s 5 percent price hike, TrendForce Corp (集邦科技) forecast.
However, Chen said he holds a conservative outlook for the NAND flash memory chip industry as the supply-demand dynamic runs out of steam.
The world’s major memory chipmakers are improving yield rates for 3D NAND flash memory to boost supply, which might lead to the current supply and demand balance being overturned in the first quarter of next year, Chen said.
Prices of NAND flash memory chips should peak this quarter before oversupply reoccurs, Chen said.
Last month alone, Adata’s pre-tax profit tumbled about 63 percent from NT$185 million in October to NT$68.53 million, dragged down by unspecified investment losses.
The company earlier this month reported record-breaking monthly revenue for 49 consecutive months, with last month’s revenue rising 7.68 percent to NT$2.94 billion compared with October’s NT$2.73 billion.
Revenue from DRAM products last month jumped 12.67 percent month-on-month to NT$1.64 billion, accounting for 55.72 percent of the company’s overall monthly revenue, the company said.
A persistent supply crunch in DRAM and NAND flash chips helped keep memory chip prices at high levels, it said.
In the first 11 months of this year, revenue totaled NT$29.67 billion, surging 41.63 percent from NT$2.56 billion in the same period last year.
Adata’s stock price yesterday tumbled 1.39 percent to NT$78, marking a second trading session of losses on the local bourse.
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