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.
STATE SUBSIDIES: The talks over a factory in Dresden have a top end on par with what Japan is offering TSMC and outdo a cap other firms are being offered in Europe Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s biggest contract chipmaker, is in talks to receive German government subsidies for as much as 50 percent of the costs to build a new semiconductor fab in the country, people familiar with the matter said. The government is in ongoing negotiations with TSMC, as well as its partners on the project — Bosch Ltd, NXP Semiconductors NV and Infineon Technologies AG — the people said, asking not to be identified because the deliberations are private. No final decisions have been made and the final subsidy amount could still change. Any state aid must also
South Korea would avoid capitalizing on China’s ban on a US chipmaker, seeing the move by Beijing as an attempt to drive a wedge between Seoul and Washington, a person familiar with the situation said. The South Korean government would not encourage its memorychip firms to grab market share in China lost by Micron Technology Inc, which has been barred for use in critical industries by Beijing on national security grounds, the person said. China is the biggest market for South Korea semiconductor firms Samsung Electronics Co and SK Hynix Inc and home to some of their factories. Their operations in China
GEOPOLITICAL RISKS: The company has a deep collaboration with TSMC, but it is also open to working with Samsung Electronics Co and Intel Corp, Nvidia’s CEO said Nvidia Corp, the world’s biggest artificial intelligence (AI) GPU supplier, yesterday said that it is diversifying its supply chain partners in order to enhance supply chain resilience amid geopolitical tensions. “All of our supply chain is designed for maximum diversity and redundancy so that we can have resilience. Our company is very big and so we have a lot of customers depending on us. And so our supply chain resilience is very important to us. We manufacture in as many places as we can,” Nvidia founder and chief executive officer Jensen Huang (黃仁勳) said in response to a reporter’s question in
BIG MARKET: As growth in the number of devices and data traffic accelerates, it will not be possible to send everything to the cloud, a Qualcomm executive said Qualcomm Inc is betting the future of artificial intelligence (AI) will require more computing power than what the cloud alone can provide. The world’s largest maker of smartphone processors is transitioning from a communications company into an “intelligent edge computing” firm, Qualcomm senior vice president Alex Katouzian said. The edge in question is the mobile device that a user taps to access a network or service, and Katouzian used his time headlining one of the major keynote events at the Computex show in Taipei to make the case for how big a market that would be. The US company’s chips help smartphones harness