Vanguard Semiconductor International Co (世界先進), which makes power management ICs and driver ICs for displays, yesterday said that net profit last quarter fell 1.4 percent from the previous quarter to NT$1.48 billion (US$49.27 million) as a newly acquired fab from GlobalFoundries Inc dragged down gross margin and prices.
Net profit was NT$1.5 billion in the fourth quarter of last year. Despite the quarterly decline, net profit rose 6.4 percent annually from NT$1.39 billion.
Earnings per share fell to NT$0.89 from NT$0.91 the previous quarter, but rose from NT$0.84 a year earlier.
Photo: Hung Yu-fang, Taipei Times
Gross margin dipped to 31 percent last quarter from 36.1 percent the previous quarter, as well as in the first quarter of last year, the company said in a statement.
The chipmaker said that it aims to limit the new fab’s erosion of its gross margin to within 5 percentage points this year.
Vanguard expects gross margin to improve to 31 to 33 percent this quarter, driven by robust customer demand and higher factory utilization of as high as 93 percent, up from about 90 percent a quarter earlier.
“At the moment, we still see our customers showing very strong demand through the second quarter,” Vanguard chairman Fang Leuh (方略) told investors during a teleconference.
“We have two months of [order] visibility until the end of the second quarter,” Fang said.
Vanguard said that it is cautious about customer demand in the second half of the year, given the sliding global economy and climbing unemployment rates worldwide.
“Uncertainty for the second half is huge,” Fang said.
Customers are not cutting orders on any downside risks yet, he added.
Vanguard expects growth momentum to boost revenue by 2 to 7.14 percent to a record high of between NT$8 billion and NT$8.4 billion this quarter, from NT$7.84 billion in the first quarter of this year.
It expects robust demand for power management ICs used in data centers, servers and work-from-home-related devices to fuel growth momentum, the company said.
Growth momentum would also come from driver ICs used in TV displays, as its Chinese display customers are gaining shares after South Korea’s Samsung Electronics Co exited the LCD market, it said.
However, driver ICs used in smartphone displays would be flat or would decline slightly this quarter from last quarter, due to customers’ inventory corrections, Vanguard said.
Power management ICs contributed 55 percent to Vanguard’s total revenue last quarter, while driver ICs for large-sized displays and small-sized displays accounted for 26 percent and 8 percent respectively.
The 8-inch fab in Singapore, which was acquired from GlobalFoundries, is operating normally and is not affected by the city-state’s disease prevention measures, as the semiconductor industry is considered a key industry for Singapore, Vanguard said.
After several years flying high as Asia’s best Nvidia Corp proxy, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) is increasingly vying with other artificial intelligence (AI) stocks for investor attention. Stock traders are chasing a wider array of beneficiaries as mainstream usage of AI creates demand for hardware beyond the most-advanced chips TSMC makes for Nvidia. Subthemes from the deepening memory crunch to advances in robotics are also luring bids. At the same time, investment caps on single stocks are pushing funds to diversify, while retail investors long familiar with TSMC through its US depositary receipts are being offered a broader set of
Netherlands-based semiconductor equipment supplier ASML Holding NV yesterday said that it is planning to hire an additional 1,000 people in Taiwan this year in response to growing demand from clients. ASML had previously planned to recruit 600 people this year, but that the plan has been adjusted upward, ASML vice president and ASML Taiwan general manager Grace Wang (汪佳慧) told reporters. ASML has a workforce of more than 4,500 in Taiwan, accounting for about 10 percent of its global total, Wang said. This year’s recruitment campaign would focus on adding people in the customer support, manufacturing and supply chain domains to assist ASML
UNDER MICROSCOPE: Taiwan detained three people who allegedly conspired to buy servers in Taiwan and export them using fraudulent documentation, prosecutors said Nvidia Corp chief executive officer Jensen Huang (黃仁勳) on Saturday urged Super Micro Computer Inc to tighten up on compliance after Taiwan detained three people this week for allegedly making fraudulent declarations about artificial intelligence (AI) servers made by its US partner. The development marked the nation’s first crackdown on semiconductor smuggling, which grew after the US slapped restrictions on exports of high-end chips such as Nvidia AI accelerators to China. Nvidia is “rigorous” in explaining regulations to all of its partners, Huang told reporters after arriving in Taipei. “Ultimately Super Micro has to run their own company,” he said in response to
Nvidia Corp yesterday announced that CEO Jensen Huang (黃仁勳) would attend an employee meeting in Taipei tomorrow to celebrate the launch of the company’s Taiwan headquarters project. Huang would attend a gathering at the site of Nvidia’s planned headquarters in Beitou Shilin Technology Park (北投士林科技園區), the company said in a statement. After arriving in Taiwan on Saturday last week, Huang told reporters that he plans to meet with Quanta Computer Inc (廣達) chairman Barry Lam (林百里) and Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) chairman C.C. Wei (魏哲家), and would attend the groundbreaking ceremony for Nvidia’s Taiwan headquarters tomorrow. Nvidia has not yet applied
RSS