Powertech Technology Inc (力成科技) yesterday said the COVID-19 pandemic would not be an obstacle to it making a record-high revenue this year, after posting its strongest first-quarter net profits in about nine years amid robust solid-state-disk (SSD) demand.
The Hsinchu-based memorychip packager and tester said most of its factories in Taiwan, China and Japan have been operating normally, unaffected by the outbreak.
“We still hold an optimistic and positive view about the second quarter. Local governments have reined in the spread of the pandemic, allowing Powertech’s fabs to operate smoothly,” chairman D.K. Tsai (蔡篤恭) told investors.
Photo: Hung Yu-fang, Taipei Times
“Some might be worried about the impact of [high] inventory [amid concern over supply disruptions last quarter], but we are seeing strong customer demand for the third and fourth quarters,” Tsai said. “We believe Powertech’s [revenue] will climb to a historical high this year, unfazed by COVID-19.”
Its confidence is also built on healthy fundamentals, as 5G-related applications, such as smartphones and 5G-enabled infrastructure and networking devices, are to fuel growth, the firm said.
Work-from-home, e-learning, e-commerce and game consoles are also stimulating demand for data centers, PCs and memory chips used in those devices, it said.
Powertech expects “a positive growth in revenue for the second quarter,” president Hung Chia-yu said.
Its DRAM business is expected to outgrow that of NAND flash memory, benefiting from launches of new smartphones and high-speed graphics, and ongoing momentum from notebook computers and data centers, he said.
Demand for system-in-package (SiP) modules has also been strong, driven by increasing consumption of SSD storage for data centers, he said.
Powertech is adding capacity this year after its loading rate climbed to 95 percent last quarter, Hung said.
Overall, loading rate for packaging services is expected to rise to as high as 85 percent this quarter, from 80 percent last quarter, he said.
Net profit jumped to NT$1.63 billion (US$54.15 million) in the first quarter, compared with NT$1.05 billion in the same period last year, marking the best first-quarter in about nine years.
On a quarterly basis, net profit dipped 21.6 percent from NT$2.01 billion, which was an all-time high.
Earnings per share rose to NT$2.1 from NT$1.36 a year ago, but down from NT$2.68 in the previous quarter.
The pandemic has delayed construction on its first panel-based packaging fab in Hsinchu by one to two quarters, but it still aims to complete construction in the fourth quarter this year, paving the way for small-volume production in the second half of next year as scheduled, Powertech said.
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