ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip packager and tester, yesterday said that net profit rose 32 percent sequentially last quarter and should grow by about 20 percent this quarter because of seasonal demand.
The double-digit percentage growth forecast is more robust than most of its semiconductor peers are projecting, as prolonged inventory digestion and slowing economic growth cast a shadow on the industry’s outlook.
However, the Kaohsiung-based company appeared confident, saying that business has picked up in the third quarter on the back of new consumer product launches ahead of the year-end holidays.
Revenue from its core chip assembly, testing and material business should return to the peak level of NT$66.32 billion (US$2.13 billion) posted in the third quarter last year, ASE Technology said.
Gross margin could climb to 21.5 percent from 15.4 percent last quarter, it said.
Electronics manufacturing services (EMS) revenue should grow to the quarterly average of NT$46 billion in the second half of last year, it said.
That would boost the company’s overall revenue by 23 percent to NT$112.32 billion this quarter .
The projection is “well above the consensus forecast of 20 percent quarter-on-quarter growth,” Yuanta Securities Investment Consulting Co (元大投顧) said in a note, attributing the robust outlook primarily to increases in system-in-package orders for Apple Inc’s upcoming iPhones and Apple Watch.
“Looking into the second half [this year], the third quarter in particular, I think that in terms of segment, communications seems to be stronger than the other two [computer and consumer],” ASE chief financial officer Joseph Tung (董宏思) told investors on Wednesday.
Revenue would continue growing at a quarterly pace in the second half, he said.
Net profit last quarter expanded to NT$2.69 billion from NT$2.04 billion in the previous quarter, but plunged 77 percent from NT$11.46 billion a year earlier, the company’s financial statement showed.
Earnings per share reached NT$0.63, compared with the first quarter’s NT$0.48 and NT$2.7 a year earlier.
The company expanded capital spending by about 86 percent to the highest level in six quarters at US$444 million last quarter from US$239 million in the prior quarter.
ASE said it has allocated production personnel and research and development resources for new EMS manufacturing sites in China to meet rising customer demand.
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