Macronix International Co (旺宏) yesterday gave an upbeat outlook for the second half of the year after posting 2.71-fold annual growth in net profit last quarter, benefiting from solid demand for PCs and servers, as well as price increases.
The world’s biggest NOR flash memorychip supplier said net profit surged to NT$2.33 billion (US$76.21 million) from NT$616 million in the same period last year and expanded 24 percent from NT$1.88 billion in the previous quarter.
Gross margin climbed to 45 percent, from 34 percent a year earlier and 42 percent in the prior quarter, primarily attributable to higher shipments of high-density and high-quality memory chips.
“We are bullish about gross margin in the second half,” Macronix president Lu Chih-yuan (盧志遠) told investors in a teleconference call.
“There is a good chance for us to register gross margin of more than 40 percent in the second half,” Lu said. “We will not rule out the possibility that gross margin will trend up [from last quarter].”
Lu’s confidence builds on “clear order visibility” as the electronics industry enters its peak season in the third and fourth quarters, especially for the consumer electronics segment.
“Our factories will continue to be fully utilized in the third and fourth quarters,” he said. “We have great confidence that we will have a significant growth.”
Revenue might grow 50 percent in the second half, from NT$17.94 million in the first half, based on the company’s business patterns, he said.
After quarters-long hikes, NOR flash prices should stabilize, although some chips might see further price upticks, Lu said.
Amid concern from investors over inventory increases, Marconix said it built NT$14.2 billion worth of inventory last quarter in preparation for demand during the peak season.
Sixty percent of the inventory is read-only memory (ROM) chips, Lu said.
Marconix counts Japan’s Nintendo Co as a major client for its ROM chips.
“Most of the inventory will translate into revenue,” Lu said.
The chipmaker plans to build more inventory in the coming quarters to cope with increasing demand, Lu said.
Lu said the company is waiting for approval from the Bureau of Foreign Trade to resume shipments to ZTE Corp (中興) after the US lifted a ban on the Chinese telecoms equipment supplier.
Macronix said it saw only minor effects from the ZTE incident.
Most Taiwanese chipmakers, including MediaTek Inc (聯發科) and Nanya Technology Corp (南亞科技), were required to apply for permission to ship chips to ZTE after the Chinese firm was barred from buying components from US suppliers earlier this year.
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