ASE Technology Holding Co (日月光投控) yesterday projected that revenue would grow by about 20 percent this year, more than double the semiconductor industry’s forecast growth, on the back of robust demand from the high-performance computing (HPC), networking and automotive segments.
The world’s largest chip packaging and testing services provider added that the growth could continue in the next five years, as it continues to benefit from market share gains, robust customer demand and a new wave of outsourcing from integrated device manufacturers (IDMs).
Taiwan Semiconductor Manufacturing Co (台積電), the world’s largest contract chipmaker and one of ASE’s major customers, recently raised the growth projection for the semiconductor industry to a high single-digit percentage over the next five years.
Photo: Lee Jung-ping, Taipei Times
Gross margin this year is expected to climb to a new high after recording 27.5 percent last quarter, ASE chief financial officer Joseph Tung (董宏思) said.
Revenue is expected to grow each quarter this year, supported by a price-friendly environment and a better product portfolio, the company said.
“Smartphone and consumer [electronics] are relatively weaker, but overall, order visibility looks healthy,” Tung told an online investors’ conference, citing strong momentum in the HPC, networking and automotive sectors.
“Even in the weaker sectors, IC content should provide support to overall unit growth due to increasing applications,” Tung said. “Also, I think one of the drivers for [the company] is the increasing outsourcing from IDM, particularly in the automotive area.”
ASE expects sales contribution from the automotive sector to advance to about 7 percent of its core assembly and testing manufacturing (ATM) business, compared with 6 percent last year.
By revenue, the automotive business is expected to reach US$1 billion this year, it said.
China’s COVID-19 restrictions have created difficulties for ASE’s operations in China, with major headaches coming from logistics snarls, and rising material and transportation costs, the company said.
There would be foreseeable production disruptions in ASE’s electronic manufacturing services (EMS) business in China this quarter and early next quarter, but the impact should be manageable, it said.
ASE expects ATM revenue this quarter to be higher than the NT$85.18 billion it posted in the fourth quarter of last year, excluding gains from the disposal of its Chinese manufacturing sites, while EMS revenue would be similar to last quarter’s level, it said.
Gross margin this quarter is forecast to rise slightly from last quarter’s level, it said.
Factory utilization should remain high at between 80 and 85 percent this quarter, similar to last quarter’s level, it said.
Net profit last quarter surged 52 percent to NT$19.2 billion (US$650.3 million) from NT$8.48 billion a year earlier, its best first-quarter performance and the third-highest in the company’s history.
However, on a quarterly basis, it represented a decline of 58 percent from NT$30.92 billion.
Earnings per share jumped to NT$3.01 from NT$1.97 a year earlier, but dropped from NT$7.2 in the preceding quarter.
ASE kept its planned capital expenditure for this year unchanged at US$2 billion.
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