Chartered Semiconductor Manu-facturing Ltd, the No. 3 maker of custom-made chips, yesterday said it had its first back-to-back quarterly loss since going public in 1999 and expects the loss to widen in the next three months.
Chartered had a second-quarter loss of US$107.6 million, or US$0.78 for each American depositary receipt, compared with a profit of US$57.9 million a year earlier. Sales fell 63 percent to US$100.6 million from US$271.4 million with shrinking demand for chips, and delaying a new plant by a year to 2003.
"Inventory levels are still high and orders have virtually stopped," said Tan Choon Hoe, a fund manager at AIB Govett (Asia) Ltd., who helps manage US$1 billion in Asian investments at AIB Govett (Asia) Ltd. in Singapore. "In the third quarter, we're unlikely to see any recovery for Chartered."
With a weaker outlook for the third quarter as customers such as Ericsson AB and Conexant Systems Inc may cut orders amid their own losses this year, Chartered said it will slash investments by 30 percent for 2001. That may hurt efforts to narrow the gap with rivals Taiwan Semiconductor Manufacturing Co and United Microelectronics Corp, analysts say.
Chartered expects revenue to decline 15 percent from the second quarter, and forecast a loss of US$0.94 to US$0.96 an ADR. The second-quarter results were in line with a loss of US$108.3 million which was the average estimate of five analysts surveyed by Bloomberg News. Each ADR represents 10 Chartered shares.
"Chartered now expects the third quarter to further deteriorate as visibility remains extremely limited and demand is still very weak," said Dan Heyler, an analyst at Merrill Lynch & Co in Taipei. "That represents a change relative to a previous guidance of stabilization in the third quarter."
Chartered's shares in Singapore fell as much as S$0.08 cents, or 1.9 percent, to S$4.14.
Singapore-based Chartered's results were hurt by declining orders from communications customers such as Ericsson and Motorola. Other mobile phone manufacturers and makers of other communications equipment made up about half of sales.
"We saw weakness in every segment and, compared with the first quarter, the largest revenue decline was in the communications segment," Barry Waite, Chartered's chief executive, said on an analysts' conference call. "In the last three quarters, the semiconductor industry has experienced one of its sharpest decelerations and 2001 is now expected to be its worst year of contraction."
NO RECIPROCITY: Taipei has called for cross-strait group travel to resume fully, but Beijing is only allowing people from its Fujian Province to travel to Matsu, the MAC said The Mainland Affairs Council (MAC) yesterday criticized an announcement by the Chinese Ministry of Culture and Tourism that it would lift a travel ban to Taiwan only for residents of China’s Fujian Province, saying that the policy does not meet the principles of reciprocity and openness. Chinese Deputy Minister of Culture and Tourism Rao Quan (饒權) yesterday morning told a delegation of Chinese Nationalist Party (KMT) lawmakers in a meeting in Beijing that the ministry would first allow Fujian residents to visit Lienchiang County (Matsu), adding that they would be able to travel to Taiwan proper directly once express ferry
FAST RELEASE: The council lauded the developer for completing model testing in only four days and releasing a commercial version for use by academia and industry The National Science and Technology Council (NSTC) yesterday released the latest artificial intelligence (AI) language model in traditional Chinese embedded with Taiwanese cultural values. The council launched the Trustworthy AI Dialogue Engine (TAIDE) program in April last year to develop and train traditional Chinese-language models based on LLaMA, the open-source AI language model released by Meta. The program aims to tackle the information bias that is often present in international large-scale language models and take Taiwanese culture and values into consideration, it said. Llama 3-TAIDE-LX-8B-Chat-Alpha1, released yesterday, is the latest large language model in traditional Chinese. It was trained based on Meta’s Llama-3-8B
STUMPED: KMT and TPP lawmakers approved a resolution to suspend the rate hike, which the government said was unavoidable in view of rising global energy costs The Ministry of Economic Affairs yesterday said it has a mandate to raise electricity prices as planned after the legislature passed a non-binding resolution along partisan lines to freeze rates. Chinese Nationalist Party (KMT) lawmakers proposed the resolution to suspend the price hike, which passed by a 59-50 vote. The Taiwan People’s Party (TPP) voted with the KMT. Legislative Speaker Han Kuo-yu (韓國瑜) of the KMT said the resolution is a mandate for the “immediate suspension of electricity price hikes” and for the Executive Yuan to review its energy policy and propose supplementary measures. A government-organized electricity price evaluation board in March
NOVEL METHODS: The PLA has adopted new approaches and recently conducted three combat readiness drills at night which included aircraft and ships, an official said Taiwan is monitoring China’s People’s Liberation Army (PLA) exercises for changes in their size or pattern as the nation prepares for president-elect William Lai’s (賴清德) inauguration on May 20, National Security Bureau (NSB) Director-General Tsai Ming-yen (蔡明彥) said yesterday. Tsai made the comment at a meeting of the Legislative Yuan’s Foreign Affairs and National Defense Committee, in response to Democratic Progressive Party (DPP) Legislator Wang Ting-yu’s (王定宇) questions. China continues to employ a carrot-and-stick approach, in which it applies pressure with “gray zone” tactics, while attempting to entice Taiwanese with perks, Tsai said. These actions aim to help Beijing look like it has