Tue, Feb 06, 2018 - Page 12 News List

Largan sales slip sparks iPhone rumors

SQUEEZED SUPPLIERS:The lensmaker saw revenue plunge 28% last month and forecast demand would stay weak this month, as Catcher, another Apple supplier, saw a 12% slide

By Lisa Wang  /  Staff reporter

Apple Inc camera lenses supplier Largan Precision Co (大立光) last month saw its revenue slump to the worst in 13 months, which it yesterday attributed to tepid customer demand during the slow first quarter.

The decline matched the company’s earlier projection, boding ill for its first-quarter earnings, as Largan has said revenue could fall for a third consecutive month this month and prospects for next month remain murky.

Revenue plunged 28 percent to NT$3.51 billion (US$120 million) last month, from NT$4.88 billion in December last year, steeper than the 13 percent month-on-month fall in December last year.

Last month’s figure meant an annual contraction of 6.33 percent from NT$3.75 billion in January last year.

Largan chief executive officer Adam Lin (林恩平) said he had foreseen the revenue plunge last month and he expects customer demand to remain weak this month.

“January was weaker than December. It looks like February will also be weaker than January,” Lin said in a call with investors last month.

Lin avoided an investor’s question as to whether the revenue weakness was caused by lower shipments of customers’ new products.

Speculation was rife that sales of Apple’s new iPhone X fell short of market expectations and that disappointing sales could mean an earlier phase-out of the model.

Lin said he did not rule out the possibility of Largan posting an annual decline in revenue for the first two months of the year.

In the same period last year, the company made NT$7.22 billion.

Lin said customers were still considering whether to adopt high-end camera lenses with better specifications for their flagship phones.

Last quarter, high-end 10-megapixel camera lenses made up about 70 percent to 80 percent of Largan’s shipments.

The weakness stood in stark contrast to Largan’s record-breaking quarterly earnings last quarter. The company’s net profit hit an all-time high of NT$8.61 billion, or earnings per share of NT$64.18, during the last quarter of last year.

Separately yesterday, Catcher Technology Co (可成), a metal casing supplier for the iPhone series, also saw its revenue decline 12 percent last month to NT$8.19 billion, from December’s NT$9.3 billion.

On an annual basis, revenue soared 68.4 percent from NT$4.86 billion in the same period last year, marking the best January in the company’s history. Catcher attributed the strong performance to shipment growth.

Catcher expects this to be another year of growth in terms of revenue, after reporting record-high revenue of NT$93.3 billion last year.

Largan shares sank 4.52 percent yesterday to NT$3,800 in Taipei trading, while Catcher saw its stock price fall 1.98 percent to NT$346.5. The TAIEX fell 1.62 percent.

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