Advanced Semiconductor Engineering Inc (ASE, 日月光半導體) yesterday said its third-quarter earnings continued to grow both annually and quarterly.
The world’s largest contract chip testing and packaging service provider attributed the strong performance to robust demand for its system-in-packaging (SiP) business from Apple Inc.
“We believe this quarter will be another growth period as expected,” Advanced Semiconductor Engineering chief financial officer Joseph Tung (董宏思) told investors in a conference call in Taipei.
During the July-to-September quarter, net profit jumped 63 percent year-on-year and 41.65 percent quarter-on-quarter to NT$7.21 billion (US$237 million).
Strong growth from the SiP business and advanced technologies will help drive the company’s revenue this quarter, as ASE lands new projects, Tung forecast.
This quarter, the company’s revenue from its SiP business, primarily for communications products, will grow 30 percent from last quarter, which would help boost the SiP revenue contribution to 20 percent of ASE’s electronics manufacturing service (EMS) business, from the 10 percent recorded last quarter, Tung predicted.
Apple is thought to be ASE’s most important customer, for the fingerprint sensors used in iPhones.
The company said its revenue for chip testing and packaging would increase from 2 to 4 percent quarter-on-quarter this quarter, and EMS revenue would increase by more than 30 percent sequentially, increasing its total consolidated revenue by more than 12 percent from last quarter’s record level of NT$66.63 billion.
Factory utilization for its core chip testing and packaging services is to rise 1 percentage point this quarter from last quarter’s between 80 percent and 85 percent, Tung said.
However, gross margin will likely edge lower this quarter from the 21.3 percent seen last quarter, as its EMS business — especially the SiP segment — commands a lower margin, Tung said.
Operating margin is expected to stay flat quarter-on-quarter, which the company attributed to the impact of operating leverage.
As for capital expenditure, the company plans to spend US$900 million and US$950 million on new equipment this year that it budgeted for earlier this year, he added.
Separately, Macronix International Co (旺宏電子), which supplies memory chips to Japanese video game console maker Nintendo Co, yesterday posted a smaller quarterly loss of NT$1.1 billion for last quarter, compared with a net loss of NT$1.8 billion in the second quarter.
Originally, Macronix failed to return to profit last month due to higher-than-expected spending from a patent lawsuit with Spansion Inc.
The chipmaker made NT$2.9 billion in revenue last month approaching the break-even level of NT$3 billion.
Company chairman Miin Wu (吳敏求) expects rising demand for NAND flash next year to help the company swing back to the black in the second half of next year.
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