LCD panel maker Innolux Corp (群創) yesterday said it was cautiously optimistic about second-half prospects as an imminent glass substrate supply constraint and an ongoing chip shortage would curb supply and avert a glut.
The supply of glass substrates might start declining this month at the earliest, as some manufacturers commence annual factory maintenance, the Miaoli-based company said.
“We believe this should help ease industry concern over a supply-demand imbalance as some capacities, which are used to make panels for monitors, notebooks or TVs, would be down,” Innolux president James Yang (楊柱祥) told an investors’ teleconference.
Photo: Lisa Wang, Taipei Times
The reduced supply would cut flat-panel production by about 360,000 units, Yang estimated, adding that a glass substrate supplier has said it plans to cut utilization by 15 to 20 percent.
Because of reduced glass substrate supply, “we are cautiously optimistic about the second-half market situation,” Yang said. “Market demand remains strong.”
Innolux forecast that shipments of panels for computers and TVs would grow by a low-single-digit percentage sequentially this quarter, benefiting from back-to-school and return-to-office demand for commercial laptops and monitors.
Average selling prices would climb by a low-single-digit percentage during the same period, it said.
Asked about Innolux’s long-term supply agreement with Chinese panel maker Sakai SIO International Guangzhou Co, company chairman Jim Hung (洪進揚) said the deal would boost the company’s output by about 2 to 3 percent next year.
Based on the agreement, Innolux would make a prepayment of 4 billion yuan (US$618.4 million) this year and next year to secure 65-inch and 75-inch TV panels from SIO’s G10.5 plant during the 2022-2033 period.
Innolux expects the strategic partnership to lift its profit margin, as G10.5 has a cost advantage over Innolux’s G6 and G8.5 factories in producing large TV panels, Hung said.
Innolux and local rival AU Optronics Corp (友達光電) do not operate G10.5 fabs, as the two have long decided that they would not join the capacity expansion race with Chinese rivals, but would rather focus on boosting their products added value.
Innolux’s net profit last quarter soared 85.13 percent to a record NT$21.42 billion (US$770.14 million).
That compares with earnings of NT$11.57 billion in the first quarter and losses of NT$5.78 billion a year earlier.
Gross margin rose to 33.1 percent last quarter, from 25.8 percent in the first quarter and 2.8 percent in the same period last year.
Revenue last month grew 35.6 percent to NT$32.25 billion, compared with NT$23.77 billion in July last year.
That represented a monthly increase of 2.3 percent from NT$31.51 billion, thanks to a 3.8 percent growth in shipments of small and medium-sized panels last month.
Shipments of panels for PCs and TVs contracted 2.3 percent month-on-month.
Quanta Computer Inc (廣達) chairman Barry Lam (林百里) is expected to share his views about the artificial intelligence (AI) industry’s prospects during his speech at the company’s 37th anniversary ceremony, as AI servers have become a new growth engine for the equipment manufacturing service provider. Lam’s speech is much anticipated, as Quanta has risen as one of the world’s major AI server suppliers. The company reported a 30 percent year-on-year growth in consolidated revenue to NT$1.41 trillion (US$43.35 billion) last year, thanks to fast-growing demand for servers, especially those with AI capabilities. The company told investors in November last year that
United Microelectronics Corp (UMC, 聯電) forecast that its wafer shipments this quarter would grow up to 7 percent sequentially and the factory utilization rate would rise to 75 percent, indicating that customers did not alter their ordering behavior due to the US President Donald Trump’s capricious US tariff policies. However, the uncertainty about US tariffs has weighed on the chipmaker’s business visibility for the second half of this year, UMC chief financial officer Liu Chi-tung (劉啟東) said at an online earnings conference yesterday. “Although the escalating trade tensions and global tariff policies have increased uncertainty in the semiconductor industry, we have not
Intel Corp has named Tasha Chuang (莊蓓瑜) to lead Intel Taiwan in a bid to reinforce relations between the company and its Taiwanese partners. The appointment of Chuang as general manager for Intel Taiwan takes effect on Thursday, the firm said in a statement yesterday. Chuang is to lead her team in Taiwan to pursue product development and sales growth in an effort to reinforce the company’s ties with its partners and clients, Intel said. Chuang was previously in charge of managing Intel’s ties with leading Taiwanese PC brand Asustek Computer Inc (華碩), which included helping Asustek strengthen its global businesses, the company
Power supply and electronic components maker Delta Electronics Inc (台達電) yesterday said it plans to ship its new 1 megawatt charging systems for electric trucks and buses in the first half of next year at the earliest. The new charging piles, which deliver up to 1 megawatt of charging power, are designed for heavy-duty electric vehicles, and support a maximum current of 1,500 amperes and output of 1,250 volts, Delta said in a news release. “If everything goes smoothly, we could begin shipping those new charging systems as early as in the first half of next year,” a company official said. The new
RSS