Local chip designer Faraday Technology Corp (智原科技) yesterday posted a net profit of NT$146 million (US$4.78 million) for last quarter, a quarter-on-quarter increase of 160.71 percent thanks to strong demand for application-specific ICs used in smart meters, networking products and 5G small cells.
On an annual basis, net profit surged 67.82 percent from NT$87 million, while earnings per share rose to NT$0.59 from NT$0.22 a quarter earlier and NT$0.35 a year earlier.
The Hsinchu-based company expects revenue this quarter to fall by a single-digit percentage from last quarter’s NT$1.59 billion, the highest level in 13 quarters.
However, it still expects to register annual growth in revenue, Faraday chief financial officer Grace Tseng (曾雯如) said.
Gross margin is to remain at about 50 percent this quarter, compared with 50.4 percent last quarter, Tseng said, attributing the slight decline to non-recurring engineering (NRE) services on 14-nanometer technology.
The company is collaborating with Samsung Electronics Co to provide 14-nanometer chips.
Faraday president Steve Wang (王國雍) said that he is optimistic about next year, as customers are accelerating the pace of the design to the mass-production process.
In addition, the company is benefiting from the US-China trade dispute, Wang said.
As China builds its own chip manufacturing capabilities and reduces its dependence on US firms, the company has seen an increase in orders, he said.
Most chips designed in the past one or two years are entering the final stages of verification and are to enter mass production next year, he added.
Faraday charges royalty fees for the chips it designs for clients, mostly after they enter mass production. That royalty income is the firm’s biggest source of revenue, providing 59 percent last quarter.
“Growth momentum from smart meters is to carry into next year. Chinese customers are showing strong demand,” Wang said.
Faraday can leverage foundry capacity in China from its parent company, United Microelectronics Corp (UMC, 聯電), Wang added.
In addition, the company expects chips for artificial intelligence Internet of Things apps and enterprise solid-state drives to start contributing next year, he added.
Revenue from the NRE and intellectual property rights businesses would hit a new high this year, extending record growth in the third quarter, Wang said.
NRE contributed 26 percent of the company’s revenue last quarter, Faraday said, adding that most NRE services utilize relatively advanced 40-nanometer and 28-nanometer technologies.
The intellectual property rights business accounted for 14.6 percent of third-quarter revenue, it said.
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) secured a record 70.2 percent share of the global foundry business in the second quarter, up from 67.6 percent the previous quarter, and continued widening its lead over second-placed Samsung Electronics Co, TrendForce Corp (集邦科技) said on Monday. TSMC posted US$30.24 billion in sales in the April-to-June period, up 18.5 percent from the previous quarter, driven by major smartphone customers entering their ramp-up cycle and robust demand for artificial intelligence chips, laptops and PCs, which boosted wafer shipments and average selling prices, TrendForce said in a report. Samsung’s sales also grew in the second quarter, up
On Tuesday, US President Donald Trump weighed in on a pressing national issue: The rebranding of a restaurant chain. Last week, Cracker Barrel, a Tennessee company whose nationwide locations lean heavily on a cozy, old-timey aesthetic — “rocking chairs on the porch, a warm fire in the hearth, peg games on the table” — announced it was updating its logo. Uncle Herschel, the man who once appeared next to the letters with a barrel, was gone. It sparked ire on the right, with Donald Trump Jr leading a charge against the rebranding: “WTF is wrong with Cracker Barrel?!” Later, Trump Sr weighed
LIMITED IMPACT: Investor confidence was likely sustained by its relatively small exposure to the Chinese market, as only less advanced chips are made in Nanjing Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) saw its stock price close steady yesterday in a sign that the loss of the validated end user (VEU) status for its Nanjing, China, fab should have a mild impact on the world’s biggest contract chipmaker financially and technologically. Media reports about the waiver loss sent TSMC down 1.29 percent during the early trading session yesterday, but the stock soon regained strength and ended at NT$1,160, unchanged from Tuesday. Investors’ confidence in TSMC was likely built on its relatively small exposure to the Chinese market, as Chinese customers contributed about 9 percent to TSMC’s revenue last
LOOPHOLES: The move is to end a break that was aiding foreign producers without any similar benefit for US manufacturers, the US Department of Commerce said US President Donald Trump’s administration would make it harder for Samsung Electronics Co and SK Hynix Inc to ship critical equipment to their chipmaking operations in China, dealing a potential blow to the companies’ production in the world’s largest semiconductor market. The US Department of Commerce in a notice published on Friday said that it was revoking waivers for Samsung and SK Hynix to use US technologies in their Chinese operations. The companies had been operating in China under regulations that allow them to import chipmaking equipment without applying for a new license each time. The move would revise what is known
RSS