Aspeed, server chip designer, to raise NT$224m from IPO

By Helen Ku  /  Staff reporter

Tue, Apr 30, 2013 - Page 13

Aspeed Technology Inc (信驊), which designs chips for servers supporting cloud computing technology, is issuing a total of 2.04 million shares for its debut on the GRETAI Securities Market today.

With an initial public offering price (IPO) of NT$110, the company expects to raise NT$223.96 million (US$7.59 million) from its debut, the company said yesterday.

A remote-end server chip provider, the company’s net profit last year grew 50.62 percent to NT$136 million, or earnings per share of NT$6.5.

Although the first quarter is usually a slow season for technology companies, Aspeed’s net profit in the first three months of the year expanded 105.93 percent to NT$40.15 million from NT$19.5 million a year ago, due to foreign-exchange gains and better operating expense control, the company told reporters.

“We are very optimistic about sales this month and forecast the figure will hit a record high after reaching NT$54.81 million in March,” Aspeed chairman Chris Lin (林鴻明) said at a pre-IPO press conference.

“Our sales from this quarter are expected to achieve sequential quarter-on-quarter growth, supported by strong demand from Microsoft Corp,” Lin added.

Aspeed’s sales of chips used in cloud computing technology-enabled servers has grown 30 percent annually since 2010, Lin said.

As Microsoft Corp and Intel Corp, the company’s two largest clients, shift focus to “cloud concepts” to meet the rapid increase in data consumption by smartphone and tablet users, Aspeed said it expected revenue from chips used in Windows 8-powered products to drive its annual sales.

Last year, chips used in servers accounted for 92.8 percent of Aspeed’s sales, while video, desktop and notebook camera chips accounted for 7.2 percent, Lin said.

Citing reports by market researchers, Lin said that enterprise servers are expected to see a compounded annual growth rate of 5 to 6 percent, but Aspeed’s cloud servers are forecast to outpace the industry and grow by up to 30 percent.

Currently, Japan’s Renesas Electronics Corp is the world’s largest supplier of remote-end server chips, accounting for 50 percent of the market, followed by Aspeed with 25 percent and the US’ Emulex Corp with 25 percent.

Aspeed last year rolled out a new chip that can convert Microsoft’s Windows 8 operating system virtually across different devices, beating Texas Instruments Inc of the US in launching the product.

“We were far ahead of Texas Instruments; together we are the only two chip providers to Microsoft,” Lin said.

“Through collaboration with Microsoft, the tech industry giant, we forecast our chip products will achieve explosive growth this year,” Lin said.