High Tech Computer Corp (HTC, 宏達電), the world’s biggest maker of phones running Microsoft Corp’s system, expects revenues this year to grow more than 20 percent year-on-year, helped by sales of its new “Touch” phone next month, a company executive said yesterday.
Sales in the current quarter could reach NT$34 billion (US$1.12 billion), with 70 percent coming from high-priced third-generation (3G) handsets, aided by a new product launch on May 6 in London, HTC financial executive Cheng Hui-ming (鄭慧明) told an investor’s conference.
That would represent a 27 percent increase from NT$26.86 billion during the same period last year, or a 7 percent quarter-on-quarter increase.
Cheng also said the company was on track to hit its full-year revenue growth target of between 20 percent and 25 percent.
“This is the most important product for HTC this year,” Cheng said. “With this phone, we’re confident of landing orders from most major operators.”
But Cheng also warned of possible delays in shipments, as HTC has yet to obtain certification for the new handset model.
“Postponing shipments of the new Diamond model may put the share price under pressure during Monday’s trading. Investors are highly sensitive to delays in product launches,” said Lu Chia-lin (呂家霖), an analyst at Macquarie.
Macquarie has an “outperform” rating on HTC, with a target price ofNT$1,020, which implies about 30 percent upside.
“HTC’s outlook for the second quarter, however, looks quite good,” Lu said, adding that its net income may be sustained at first quarter levels.
Earlier this month, HTC said that net profits expanded at a faster-than-expected 25 percent year-on-year to NT$6.94 billion after deducting spending for employee bonuses, as it sold more high-margin 3G phones.
Gross margins this quarter may drop by half or a full percentage point to 35 percent or 35.5 percent from last quarter’s 36.1 percent because of a one-time inventory write-off — not demand concerns, Cheng said.
“[Demand in] Europe looks similar to what we saw in November and December,” Cheng said.
HTC derives the bulk — or 40 percent — of its sales from Europe.
Average selling prices are expected to remain firm in the current quarter, Cheng said, despite claims by rivals, such as Nokia Oyj, saying European demand was shifting to lower-priced models in the face of the economic slowdown.
HTC also plans to raise its dividend payout ratio to about 70 percent based on last year’s earnings. The company paid out 60 percent last year.
The board yesterday approved a proposal to distribute NT$34 per share in cash dividends and 30 percent in stock dividends based on the company’s earnings last year of NT$28.93 billion, or NT$50.44 per share.
The proposal will be voted on at the company’s annual shareholder’s meeting on June 30.
SEEKING ENGINEERS: The Dutch chipmaking equipment supplier is planning to hire 2,000 workers for a planned campus in New Taipei City’s Linkou District Dutch chipmaking equipment supplier ASML Holding NV is planning to offer NT$1.6 million (US$51,331) or more in starting annual pay to engineers with a master’s degree at its sites in Taiwan. The major supplier to contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) said it is keen to offer competitive compensation comprised of salaries, bonuses and other financial incentives as it seeks to expand its talent pool in Taiwan. The company, which is planning to build a plant in New Taipei City, said engineers would in their first year be granted 10 days annual leave, compared with the minimum of three days
Two US Federal Reserve officials reinforced expectations the central bank would slow their pace of interest rate increases next month, even as they stressed the need to keep tightening. San Francisco Fed President Mary Daly and Cleveland Fed President Loretta Mester said during separate remarks on Monday that inflation remains too high and policymakers have a way to go before completing their tightening campaign. However, they both characterized the need for officials to be judicious as they calibrate policy. “I think we can slow down from the 75 at the next meeting, I don’t have a problem with that,” Mester said during
‘SEASONED’: Chiang Shang-yi is to help guide Hon Hai’s global semiconductor development strategy as the firm accelerates the pace of capacity deployment Hon Hai Technology Group (鴻海科技集團) has hired former Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) cochief operating officer Chiang Shang-yi (蔣尚義) as a strategy officer to assist its semiconductor business development, the group said yesterday. Chiang’s appointment took effect immediately. He is to report directly to Hon Hai chairman Young Liu (劉揚偉). Chiang was the central figure in TSMC’s technology advancement, and once considered a potential successor to TSMC founder and former chairman Morris Chang (張忠謀). He spent the past few years in China assisting Chinese chipmakers Semiconductor Manufacturing International Corp (中芯國際) and Wuhan Hongxin Semiconductor Corp (武漢弘芯半導體). Chiang on Oct. 18 attended a
PRIORITY SHIFT: TSMC previously said it would build two new fabs in Kaohsiung, but earlier this month said it was postponing construction of a 7-nanometer factory Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday said that construction of a factory in Kaohsiung to produce 28-nanometer chips is under way, with mass production set to start in 2024. TSMC, the world’s largest contract chipmaker, made the announcement after reports about the company’s capacity expansion plans in Kaohsiung. Industry insiders said that TSMC on Friday awarded the contract to build the new fab to Fu Tsu Construction Co (互助營造). The chipmaker, a major Apple Inc supplier, did not directly respond to the reports, saying only that construction had started following the completion of land grading. TSMC previously said it intended to build a