Taiwan yesterday pledged to work closely with the US and other allies to prevent China’s military from acquiring state-of-the-art technology, as Washington steps up efforts to contain the world’s No. 2 economy. Taiwan, home to the world’s largest semiconductor foundry, will keep its advanced chip development at home, while adopting measures to stop its tech from being used by the Chinese People’s Liberation Army, Deputy Minister of Economic Affairs Chen Chern-chyi (陳正祺) said yesterday. Chen said that while Taiwan’s economy would not be able to decouple from its biggest trade partner, it would implement “very firm” export controls to keep advanced technologies from China’s military. “With respect to national security, we will take measures to safeguard our trade secrets, safeguard our key technologies, safeguard our talent [so that they are] not poached illegally,” he said. Taiwan investigated Alchip Technologies Inc (世芯) for allegedly supplying advanced supercomputer chips to China’s Phytium Information Technology Co (飛騰信息技術) — which some analysts have said has links to the Chinese military — and banned chip exports to Phytium, Chen said. “Once we find a loophole, we plug it,” he said. Phytium, which is affiliated with research arms of the Chinese military, relied on Alchip for certain designs, the Washington Post reported in April last year. The Taiwanese company also dealt with Taiwan Semiconductor Manufacturing Co (台積電) for production on behalf of Phytium, it said. The US eventually blacklisted Phytium, prompting Alchip to declare a suspension of shipments. Regulators would also fine iPhone assembler Hon Hai Precision Industry Co (鴻海精密) for failing to report an acquisition by the company’s Shanghai-listed arm of a stake in China’s top chipmaker, state-backed Tsinghua Unigroup (清華紫光), he said. Chen’s comments come as US President Joe Biden’s administration prepares new restrictions on chip exports to China, which would formalize export controls on the technology behind advanced semiconductors, while
Housing affordability deteriorated in the second quarter, with the mortgage burden picking up 1.27 percent to 39.62 percent nationwide, while housing prices climbed to 9.69 times household income, a survey released by the Ministry of the Interior on Sunday showed. The uptrend in unaffordability came after median house prices in the nation rose 0.46 percent to NT$8.5 million (US$269,260) per unit from NT$8.4 million in the first quarter, while interest rates on new mortgages climbed from 1.358 percent to 1.592 percent, the ministry said. The readings likely evolved in the same direction last quarter after the central bank last month announced another rate hike of 0.125 percentage points, while housing prices held firm amid rising building material and labor prices, it said. The ministry classifies mortgage burdens of more than 50 percent of income as “extremely high,” between 40 and 50 percent as “high,” and less than 30 percent as “reasonable.” The unaffordability reading was much sharper in Taipei, with housing prices equivalent to 16.17 times average household income and 66.12 percent of the money going to mortgage payments, the ministry said. Housing prices amounted to 12.82 times household income in New Taipei City, with mortgage burdens taking up 52.41 percent, it said. Mortgage burdens in Taichung climbed to 45.54 percent of household income, and constituted 38.26 percent and 38.17 percent of household income in Tainan and Kaohsiung respectively, the ministry said. Taoyuan had a relatively reasonable mortgage burden of 32.01 percent — the lowest among the six special municipalities — as housing prices stood at 7.83 times household income, it said. By absolute value, housing prices in Keelung, Chiayi, Yunlin and Pingtung met the reasonable test of less than 30 percent of household income, it said. The ministry urged people to exercise caution, as long-term mortgages are vulnerable to interest rate adjustments.
The government would trim its GDP growth forecast of 3.76 percent for this year if exports disappoint, but the reading would stay above the 3 percent mark, National Development Council Minister Kung Ming-hsin (龔明鑫) told lawmakers yesterday. Kung made the remarks as lawmakers raised concerns over the economy, inflation and monetary policy. The Directorate-General of Budget, Accounting and Statistics, which in August cut its growth forecast for this year to 3.76 percent, could revise it down again next month if exports fare weaker than expected, Kung said. Exports, the mainstay of Taiwan’s small and open economy, likely had slipped into contraction mode last month after squeezing a mild 2 percent gain in August, the Ministry of Finance has said. Shipments of tech products slowed drastically in August, while those of non-tech products dipped into negative territory. The government is to release last month’s trade data tomorrow. Kung voiced confidence that GDP growth would exceed 3 percent this year, but expressed reservations when asked if it would be larger than 3.5 percent. Growth in the consumer price index for last month is forecast to remain above 2 percent, but is likely to be weaker than August’s growth of 2.66 percent due to a drop in international oil prices, he said. However, it would be difficult for world energy prices to slump given lingering supply issues, Kung said, adding that while oil prices have sagged, natural gas prices remain high amid the war in Ukraine. Central banks in advanced nations would reconsider the wisdom of drastic tightening to curb inflation after the UN on Monday warned that the monetary policies of wealthy nations could spark a global economic downturn, Kung said. Lawmakers from across party lines expressed unease that capital flight would persist, and hurt the local currency and share prices given Taiwan’s widening interest rate gap with major economies. The global
The nation’s foreign exchange reserves last month posted their biggest decline in 12 years to an 18-month low of US$541.11 billion, as capital flight persisted and the central bank intervened to support the local currency, the central bank said yesterday. “The decline in foreign exchange reserves came after major currencies weakened against the US dollar and the central bank sought to tame the local currency’s depreciation,” Department of Foreign Exchange Director-General Eugene Tsai (蔡炯民) told an online news conference. The New Taiwan dollar last month shed 4.46 percent versus the greenback after the US Federal Reserve raised interest rates by 0.75 percentage points to rein in inflation. Over the same period, the Australian dollar tumbled 5.74 percent, the British pound lost 5.1 percent and the yen softened 4.24 percent against the US dollar, Tsai said. The central bank spent US$8.25 billion to support the NT dollar in the first six months of this year, with the volume expected to pick up in light of the local currency’s downward trajectory. At the same time, drastic tightening by major central banks sent financial markets into wild swings, and the local bourse proved no exception, Tsai said. Securities and saving deposits held by foreign portfolio managers stood at US$436.9 billion, equivalent to 81 percent of foreign exchange reserves — the lowest since July 2020, Tsai said. The NT dollar fell the most in 25 years in the quarter ending on Sept. 30. It was the second-worst performance in Asia after the won, with global funds selling more than US$10 billion of Taiwanese stocks, Bloomberg data showed. While the period saw Chinese threats toward Taiwan intensify, the outflows were mainly due to the US rate hikes, central bank Governor Yang Chin-long (楊金龍) said last month. “Asian central banks might have to keep up their direct and indirect FX intervention to slow
ENVIRONMENTAL REGULATIONS: The bulk shipper said that tighter rules would not affect its operations given its relatively young and energy-efficient fleet
Wisdom Marine Lines Co (慧洋海運) yesterday reported a pretax profit of NT$2.6 billion (US$82.4 million) for last quarter, down from NT$4.2 billion in the second quarter, as the bulk shipper last month posted its lowest profit in seven months. Pretax profit last month came in at NT$701 million, as revenue also hit a seven-month low of NT$1.87 billion, despite bulk shipping rates rebounding from August, Wisdom said. The recovery in shipping rates was due to rising grain exports from the Americas and EU imports of coal from the US, Australia and Indonesia, with the Baltic Panamax Index rising 71 percent to 2,082 points last month from 1,217 points in August, Wisdom said. The Baltic Supramax Index and the Baltic Handysize Index also recovered mildly, it said. Wisdom said it did not benefit from the rebound in spot rates last month, as it had received advanced payments from clients. “We expect a deferred effect,” it said in a statement. In the first nine months of the year, cumulative pretax profit hit an all-time high of NT$9.5 billion, Wisdom said. The shipper is upbeat about shipping rates this quarter — the peak season for coal and grains transport, it said. As the International Maritime Organization is to impose two tighter environment gauges — the Energy Efficiency Existing Ship Index and the Carbon Intensity Indicator — in January, it would affect overall shipping capacity next year, Wisdom said. However, Wisdom said that it would not be affected as its fleet’s average age is only seven years and it mainly uses energy-efficient vessels.
A Miaoli County Government employee holds a hairy crab, also known as dazha crab, at a news conference in Miaoli City yesterday as local farmers are soon to start selling the highly sought-after crustaceans. The county government said it has implemented stricter inspections to ensure food safety.
ON THE HORIZON: The bottom of the current cyclical downturn for chipmakers is approaching, and TSMC is positioned to benefit as demand returns, analysts said
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) shares surged the most in almost three months after Morgan Stanley projected a return to growth for the semiconductor industry by the second half of next year, spurring a sector rally in Asia. The investment bank crowned TSMC — Asia’s most valuable listed corporation — a top pick, calling it “an enabler of future technology.” TSMC gained 3.73 percent in Taipei yesterday, while memorychip maker SK Hynix Inc rose 4.18 percent. Global chipmakers had been riding high early in the COVID-19 pandemic, when work-from-home fueled demand for computers and other consumer electronics. However, inflation and recession fears — plus a return to the office — have put a damper on purchases. In response, memorychip makers such as Micron Technology Inc and Kioxia Holdings Corp have slashed output to try to prop up prices. TSMC is in a different position. As the world’s most advanced logic chipmaker, it should benefit as industry demand begins to climb back next year, Morgan Stanley analysts wrote in a report on Tuesday. The US investment bank also upgraded stocks including SK Hynix, Apple Inc, South Korean flat panel supplier LG Display Co and its Taiwanese rival, AUO Corp (友達光電). “We are well advanced in the current cyclical downturn from where global semiconductor shipment units peaked around September last year,” the analysts wrote in a research report. “We are not calling for the beginning of a new cycle, but acknowledge that an inflection [bottom] is closer.” In a separate report, Morgan Stanley also upgraded stocks in emerging markets and Asia excluding Japan to “overweight” from “equal weight,” saying it is likely a bottom is near. Morgan Stanley expects the MSCI Emerging Markets Index, which has slumped for five straight quarters and lost 26 percent this year, to rally about 12 percent from Tuesday’s close until June. “A lot of
Largan Precision Co (大立光), a supplier of smartphone camera lenses to Apple Inc, yesterday reported its largest rise in monthly sales in almost two years, with analysts attributing the growth to the recent launch of the iPhone 14 series. The company posted NT$5.103 billion (US$161.7 million) in consolidated sales last month, the highest since November 2020, when its revenue was NT$5.24 billion. Last month’s sales rose 22.31 percent from a year earlier and also grew 14 percent from a month earlier, helping Largan generate enough sales to top the NT$5 billion mark for the first time almost two years, company data showed. Apple’s worldwide launch of the iPhone 14, iPhone 14 Plus, iPhone 14 Pro and iPhone 14 Pro Max last month gave Largan a boost, analysts said. Last month, lenses with a resolution of 20 megapixels or more — a higher-margin product and one of Largan’s specialties — accounted for 10 to 20 percent of total sales, the company said. Lenses with 10-20 megapixels accounted for 50 to 60 percent of Largan’s sales, 8-10 megapixel lenses made up about 10 percent, and other products, such as voice coil motors, contributed 30 to 40 percent, it said. In the third quarter of the year, Largan generated NT$13.48 billion in consolidated sales, up 39 percent from a quarter earlier and up 13 percent from a year earlier. However, consolidated sales in the first nine months were down 2 percent from a year earlier to NT$33.29 billion, company data showed. Largan said sales growth momentum this month is expected to come close to last month’s as its clients continued to place large orders. Analysts said if Largan’s sales growth continues this month, its aggregate revenue in the first 10 months is expected to return to an upward trajectory. Largan has scheduled an investors’ conference for Thursday next week to detail its third-quarter
SUPPLY AND DEMAND: The prices of flat panels are set to rise after companies cut back production amid an earlier slump in demand, TrendForce said in a report
The prices of some TV panels are to pick up this month, as vendors build up inventory ahead of the annual Double 11 Singles’ Day shopping event in China, reversing a downtrend over the past five quarters, market researcher TrendForce Corp (集邦科技) said in a report yesterday. The price rebound is primarily driven by a reduction in panel supply rather than by an improvement in demand, after flat-panel makers reduced factory utilization amid an industry slump, TrendForce said. The prices of TV panels smaller than 72 inches (183cm) are to stabilize this month as prices have fallen to near the manufacturing costs, leaving little room for further decline, while panel makers are keeping a tight rein on factory utilization to control supply, the Taipei-based market researcher said. As AUO Corp (友達) reduced its factory utilization to 70 percent in the second quarter and Innolux Corp (群創) expected its factory utilization to go down to as low as 50 percent last quarter, prices for 32-inch TV panels have climbed US$1 per unit, TrendForce said. The prices of other sizes of TV panels are to see hikes between US$3 and US$5 per unit, it said. In addition, the prices of panels used in monitors are also showing signs of stabilizing, with the prices of 21.5-inch monitor panels and those smaller than 21.5 inches likely to be flat this month, TrendForce said. The mainstream 23.8-inch and 27-inch panels are to see smaller declines of US$1.5 per unit, it said. However, demand for panels used in notebook computers continues to stagnate due to excessive inventory, with the prices of higher-resolution 14-inch and 15.6-inch panels likely to fall by between US$1 and US$1.2 per unit, representing a monthly decline of 2.4 percent, compared with a 1.8 percent fall last month, it said. Meanwhile, prices of 27-inch LED monitor panels and 14-inch LED panels
Micron Technology Inc on Tuesday announced it would open a semiconductor plant in upstate New York, promising a long-term investment of up to US$100 billion and a plant that could bring 50,000 jobs to the state. The company was lured to the Syracuse area with help from a generous set of federal, state and local incentives, including up to US$5.5 billion in state tax credits over 20 years. The announcement comes after US Senate Majority Leader Charles Schumer had pushed for Idaho-based Micron and the company’s CEO, Sanjay Mehrotra, to consider upstate New York for its factory. It also comes months after Congress passed the US$280 billion Creating Helpful Incentives to Produce Semiconductors and Science Act, which set aside US$52 billion to bolster the semiconductor industry. “An investment of this scale in the US is simply not possible without significant government and community support,” Mehrotra said at the announcement. In addition to tax credits tied to investment and job creation, New York has pledged US$200 million for road and infrastructure improvements where the plant is being built in suburban Clay and US$100 million to a “community benefit” fund. The state would also review supplying the operation with low-cost power. The federal bill was aimed at bolstering US competitiveness against China and avoiding another chip shortage like the one that derailed the automobile and technology industries during the COVID-19 pandemic. “Chips are essential to our economy, and if we were to lose the ability to manufacture chips here in the United States, it would be a severe, both economic security and national security risk,” Schumer said in an interview with The Associated Press. “This will be the most advanced memorychip manufacturing facility in the United States and probably the world. And it’s located in a place that will really benefit from it.” The company plans to invest up
People walk past the Ruins of St Paul’s in Macau yesterday. The territory’s economic slowdown extended into last month, with gaming revenue falling 49.6 percent as China’s snap lockdowns to control COVID-19 outbreaks discouraged tourists from visiting the gambling hub.
‘BUYER’S REMORSE’: Tesla’s CEO likely realized he would not win a trial over his efforts to pull out of the deal and said he would close it at the agreed-on price
Tesla Inc chief executive Elon Musk on Tuesday offered to push through with his buyout of Twitter Inc at the original agreed price, as a trial over his efforts to withdraw from the deal loomed. The world’s richest man said in a filing with the US Securities and Exchange Commission that he had sent Twitter a letter vowing to honor the contract. The latest twist in the long-running saga came ahead of the high-stakes court battle launched by Twitter in an attempt to hold Musk to the deal he signed in April. Musk’s potential stewardship of the influential social media site has sparked worry from activists who fear he could open the gates to more abusive and misinformative posts. “We write to notify you that the Musk Parties intend to proceed to closing of the transaction,” a copy of the letter to Twitter filed with the commission said. Twitter confirmed that it received the letter from Musk, and said it intends to close the buyout deal at the agreed-on price of US$54.20 per share. Conditions noted in Musk’s letter included that the court halt action in the lawsuit against him. He had been scheduled to be questioned under oath by Twitter attorneys later this week. Musk wrote on Twitter that buying the social media company “is an accelerant to creating X, the everything app,” but offered no details. During an annual shareholders’ meeting in August, Musk said Twitter could add momentum to a vision he had for the X.com company he founded in 1999. X.com merged with Confinity Inc, whose cofounders include Peter Thiel, and the entity went on to become PayPal Inc. “I do sort of have a grander vision for what I thought X.com, or X corporation, could have been back in the day,” Musk said at the shareholders’ meeting. “I think Twitter would help accelerate that by
Ukrainian central bank Governor Kyrylo Shevchenko unexpectedly resigned, citing health reasons as the nation battles to fend off Russia’s invasion and stabilize an economy devastated by war. Shevchenko submitted his resignation letter to Ukrainian President Volodymyr Zelenskiy, a statement posted on the central bank’s Web site on Tuesday said. His departure is subject to approval by parliament. Once the assembly accepts it, his first deputy, Kateryna Rozhkova, would take over as the acting governor, the bank’s press office said. “Due to health-related reasons, which I cannot continue to ignore, I made a difficult decision for myself,” Shevchenko said in the statement. Until his resignation is processed, Shevchenko said the central bank board would “continue to perform its functions and manage the activities of the National Bank in its current composition.” His departure comes as IMF officials prepare to assess the nation’s financial needs later this month. Ukraine is seeking a large-scale loan program from the lender apart from US$1.3 billion in a single unconditional disbursement the IMF is already considering. “It’s not a tragedy for the National Bank of Ukraine, as Shevchenko hasn’t proven himself in this post, though it’s worth paying tribute to him for not yielding the central bank’s independence,” said Oleksandr Parashchiy, research director at Kyiv-based Concorde Capital. A new governor might be appointed quickly given the president’s backing in parliament, he said. Parliament is to debate Shevchenko’s resignation today, lawmaker from the president’s Servant of the People party Andriy Gerus said by telephone. The bank hiked interest rates to 25 percent in June, citing the “shift in the fundamental parameters” of the nation’s economy during the war. It also had to devalue the hryvnia, calling it a 25 percent correction, in July to protect its foreign-currency reserves. The bank has flagged a pause in monetary tightening until at least the second quarter of 2024
A steepening drop in eurozone business activity last month is likely to put paid to any hopes the currency union avoids recession, just as elevated inflation puts pressure on the European Central Bank (ECB) to act, a survey showed. S&P Global’s final composite Purchasing Managers’ Index (PMI) for the eurozone fell to a 20-month low of 48.1 last month from August’s 48.9, below a preliminary 48.2 estimate. Anything below 50 indicates contraction. “Any hopes of the eurozone avoiding recession are further dashed by the steepening drop in business activity signaled by the PMI,” S&P Global Market Intelligence chief business economist Chris Williamson said. “Not only is the survey pointing to a worsening economic downturn, but the inflation picture has also deteriorated, meaning policymakers face an increasing risk of a hard landing as they seek to rein in accelerating inflation,” he said. Reversing a downward trend, both the composite input and output prices indices rose sharply. The input prices PMI jumped to 77.1 from 72.3. Rising prices — particularly energy costs — alongside a gloomy economic outlook, have kept consumers wary and the PMI for the bloc’s dominant services industry sank to 48.8 last month from 49.8, its lowest since February last year. “Soaring inflation, linked to the energy crisis and war in Ukraine, is destroying demand at the same time that business confidence is slumping to levels not seen since the region’s debt crisis in 2012, excluding [COVID-19] pandemic lockdowns,” Williamson said. “Companies and households alike are therefore cutting back on discretionary spending and investment in preparation for a harsh winter,” he said. Yesterday’s data come after a sister survey on Monday showed manufacturing activity across the eurozone declined further last month, as a growing cost-of-living crisis hurt demand while soaring energy bills limited production. The decline in activity across the region but with prices rising much faster than
OPEC+ was yesterday considering its biggest production cut since 2020 as it tries to stabilize oil prices, a move that risks cranking up tensions with Washington. The group was set to discuss a cut to its production limits of as much as 2 million barrels a day, using current baselines, delegates said ahead of the meeting. Still, in reality the move would have a smaller impact on global supply as several countries are already pumping below their quotas. They might also discuss smaller cuts of 1 million to 1.5 million barrels a day, delegates said. “This is an important meeting,” Emirati Minister of Energy Suhail Al Mazrouei told reporters in Vienna. A large OPEC+ cut risks adding another shock to the global economy, which is already battling inflation driven by high energy costs. It would irk the US — and potentially trigger a response from Washington. US President Joe Biden visited Saudi Arabia earlier this year in search of higher production and lower pump prices for Americans ahead of the midterm elections next month. “It is hard to overstate how anxious the Biden administration is about a potential resurgence in oil prices,” Rapidan Energy Group founder Bob McNally said in Vienna. “A large OPEC+ cut would antagonize the White House though officials may wait to see how prices respond afterward before pulling the trigger on policy responses,” he said. White House officials have asked the US Department of Energy to analyze whether a ban on exports of gasoline, diesel and other refined petroleum products would lower prices, Bloomberg reported on Tuesday. It is a controversial idea, but one that is gaining traction in some corners of the Biden administration As OPEC+ ministers meet in Vienna, European and US leaders are working to curb the revenues that Moscow receives from oil to try to weaken Russian President
PENNY-PINCHING: Britain’s biggest grocer is fighting to retain shopper loyalty by matching its prices of basic items with cheaper rivals like Aldi amid soaring inflation
Tesco PLC said consumers “watching every penny” are still shopping at its stores amid intense competition from discount grocery rivals. Britain’s biggest grocer reported better-than-expected sales in the first half of the year and only slightly cut the top end of its profit guidance for this fiscal year, even as costs rise as it tries to keep shelf prices low and increases staff pay. Tesco is fighting to keep shopper loyalty as consumers in the UK decamp to cheaper rivals Aldi and Lidl. The highest inflation in four decades and rising energy bills are piling pressure on consumers to save money on food. Tesco matches its prices with Aldi across hundreds of basic items that range from teabags to bananas to try to avoid losing market share to the discounter. “Customers are increasingly concerned about household spending and are watching every penny to make ends meet,” Tesco chief executive officer Ken Murphy said on a call. Tesco said its hourly workers are to receive an extra ￡0.20 (US$0.23) an hour taking the base rate of pay to ￡10.30 an hour to help ease the cost-of-living crisis for its staff. The grocer also raised its dividend and froze pricing on more than 1,000 products until next year. The grocer now expects retail adjusted operating profit would be between ￡2.4 billion and ￡2.5 billion this year, lowering the upper range from ￡2.6 billion. Tesco pointed to “significant uncertainties” in the trading environment, particularly consumer behavior. Rival Morrisons last week reported a 50 percent slump in adjusted third-quarter earnings. Even Aldi, which is winning customers and growing its market share, has seen pretax profit slide more than 85 percent from the year earlier. Tesco also said it was trying to deliver its three-year savings goal 12 months early and reach ￡1 billion of savings by February 2024. As part
A store assistant arranges the window display of a jewelry store in the Diamond Quarter of Antwerp, Belgium, on Tuesday. Some EU nations want sanctions on the import of Russian stones to the bloc, but the diamond industry looks likely to be spared for now.
NEW ZEALAND Central bank hikes rates The Reserve Bank of New Zealand yesterday delivered its eighth consecutive interest rate hike, sending the nation’s borrowing costs to their highest level in more than seven years, as it joins a global battle against surging inflation. The central bank stayed true to its course of the past 18 months, unveiling another increase of 50 basis points in its key rate to 3.5 percent — a level not seen since May 2015 — and warned of more rises in a bid to stymie price rises. It said inflation could climb beyond the current 7.3 percent rate, which is a 32-year high. SINGAPORE Chinese top property buyers Chinese buyers have scooped up the biggest number of Singapore’s private apartments this year compared with other foreigners. Buyers from China purchased 932 private units in the first eight months of this year, almost twice the number bought by Malaysians, which came in second, a report by industry watcher OrangeTee & Tie Pte (橙易產業) said. Chinese buyers have been the biggest foreign buyer group since 2016, and took up 6.7 percent of total transactions this year, almost bouncing back to pre-COVID-19 levels. Other countries within the top five foreign buyers include India, followed by the US and Indonesia. HONG KONG M&A slumps 40 percent The Chinese territory is letting people go on a proper holiday for the first time since the COVID-19 pandemic began. For bankers, the chance to take a break also speaks to a steep fall in dealmaking activity — in the territory and across the region. While the decline has been global, it has been particularly acute in the Asia-Pacific region. The volume of mergers and acquisitions (M&A) in the Asia-Pacific region plunged by more than 40 percent from last year to about US$156 billion in the third quarter, the worst such period
Q3 JUMP: The company said that it is ‘cautiously positive’ about how it will perform this quarter, given rising inflation, the COVID-19 situation and supply chain issues
Hon Hai Precision Industry Co (鴻海精密) yesterday said that revenue last quarter expanded at a faster-than-expected pace quarter-on-quarter after a spike driven by the launch of Apple Inc’s iPhone 14 series. The major iPhone assembler said that sales last month surged to NT$822.3 billion (US$25.9 billion), up 83 percent from NT$448.91 billion in August, due to smooth production and strong growth momentum from smartphone demand. Sales grew 40.39 percent from NT$585.73 billion a year earlier, it said. “Strong revenue performance in smart consumer electronics products was the main revenue driver,” Hon Hai said in a statement. In addition, cloud-based and networking products grew by a double-digit percentage last month, thanks to increases in server shipments, the company said, adding that computing products also delivered significant growth. Third-quarter revenue jumped 15.62 percent quarterly and 24.4 percent annually to NT$1.746 trillion, the best third-quarter revenue in the company’s history, it said. Last quarter’s performance greatly exceeded Hon Hai’s previous guidance of a flat quarter compared with the second quarter. The company had expected a high base of comparison a quarter earlier and uncertainty about consumer adoption of new iPhones to constrain its revenue growth. Hon Hai said it is “cautiously positive” about its business performance this quarter given rising inflation, the development of the COVID-19 situation and supply chain issues. Cumulative revenue for the year through last month totaled NT$4.66 trillion, up 13.66 percent from NT$4.1 trillion a year earlier. The company kept its revenue growth forecast for this year unchanged. Hon Hai is the major assembler of the iPhone 14 series, with 60 to 70 percent of orders, TF International Securities Group Co (天風國際證券) analyst Kuo Ming-chi (郭明錤) said. Hon Hai would “markedly benefit” from an increase in average selling prices of iPhone 14s, Kuo said. Apple has asked Hon Hai to switch its iPhone 14 production lines to make to iPhone
‘NO REVENGE REBOUND’: Inflation and monetary tightening would continue to weigh on confidence, despite the reopening of borders next week, an analyst said
Commercial property transactions last quarter totaled NT$34.6 billion (US$1.09 billion), up 24.9 percent from three months earlier on the back of solid demand for factories and factory offices, the local branch of international property consultancy Cushman & Wakefield said yesterday. The volume reversed two previous quarters of decline, boosted by Taiwan Life Insurance Co’s (台灣人壽) purchase of an industrial building in Taoyuan’s Cingpu District (青埔) for NT$6.3 billion, Cushman & Wakefield Taiwan said. The market is poised to slow or correct itself, as interest rate hikes would add hurdles to the investment plans of life insurers and other institutional players, which accounted for 65 percent of transactions in the first three quarters of this year, it said, adding that economic uncertainty also warrants caution. Interest rate hikes mean that life insurers have to look for investment targets that generate higher rental incomes to meet regulatory requirements on minimum yields. The options would narrow in light of property price increases. “There won’t be a revenge rebound to celebrate the upcoming border reopening ... rather, inflation, monetary tightening and other risks would continue to weigh on confidence,” Cushman & Wakefield Taiwan managing director Billy Yen (顏炳立) said, referring to an easing of COVID-19 rules for people arriving in Taiwan from Thursday next week. The bull market is over, although the sell side is refusing to concede and is generally standing firm on prices, Yen said. Confusion and chaos would dominate the market this quarter and price corrections would appear inevitable next year if things fail to improve, he said. Land deals last quarter totaled NT$52.1 billion and would drop to between NT$160 billion and NT$180 billion for the whole of this year, lower than the 10-year average of NT$197.3 billion, ending three years of boom, the consultancy said. Property developers have turned conservative about building land stock, shifting focus to