Sat, Jun 15, 2019 - Page 12 News List

Winbond reports uptick in demand

SITUATION ‘NORMAL’:Winbond chairman Arthur Chiao said the company has no major changes planned amid a US-China trade dispute, saying it would be short-term

By Lisa Wang  /  Staff reporter

Winbond Electronics Corp (華邦電子), the world’s biggest maker of NOR flash memory chips by shipment, yesterday said that customer demand has regained traction, a sign that the global memory industry has come out of the woods.

A supplier of niche memory chips, Winbond said that it did not plan to make a drastic capacity adjustment to counteract the short-term trade shock, given its bullish view of the long-term market.

Winbond is to continue with its NT$355 billion (US$11.3 billion) investment to build a 12-inch fab in Kaohsiung to meet rising customer demand, it said.

Construction began in October last year.

The factory is to start mass production in 2021 using 20 nanometer technology, it said.

Winbond has hired several hundred employees to work at the new fab, company chairman Arthur Chiao (焦佑鈞) told reporters on the sidelines of the company’s annual shareholders’ meeting in Taipei.

“We do not plan to make any major changes during this transition period as it [the US-China trade dispute] is a short-term thing,” Chiao said.

Chip supply to Huawei Technologies Co (華為) remains “normal,” as its exports are in full compliance with international trade rules, Winbond said.

The exports do not surpass the US cap of 25 percent on US technology content, as Winbond designs and produces chips in Taiwan, Chiao said.

The industry’s ups and downs would affect Winbond, as it supplies more than 30 percent of NOR flash memory chips used in consumer electronics such as iPads and smart watches. The company has a marginal 0.7 percent share of the DRAM market worldwide with its specialty DRAM chips a key factor.

After booming in 2017 and last year, “this year will see the first decline in the past three years for global memory ICs,” Chiao said.

“After a slump in the first quarter of this year and the fourth quarter last year, we think the second half will be a cheerful period,” he said.

“It might not be as good as what happened in 2017 or 2018, but I think nothing significant would happen. The worst is over” for the industry, he said.

Factory utilization has rebounded to about 85 percent, compared with less than 80 percent in the three months to March, Winbond said.

Winbond president Chan Tung-yi (詹東益) said that he did not expect an immediate impact from rising production in China, as firms there target other markets, while they have issues with the availability of technology.

Winbond shareholders yesterday approved a cash distribution of NT$1 per common share, representing a 53.48 percent payout ratio based on the company’s earnings per share of NT$1.87, or net profit of NT$7.45 billion, last year.

Shareholders also approved the appointment as an independent board director of Stephen Tsao (左大川), a former senior vice president at Taiwan Semiconductor Manufacturing Co (台積電).

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