Cloud computing equipment supplier Wiwynn Corp (緯穎科技) yesterday said it still plans to expand total production capacity by 50 percent from this year to 2024, even as businesses are becoming conservative on capital spending amid an economic downturn.
Wiwynn, a subsidiary of contract electronics maker Wistron Corp (緯創), provides hyperscale datacenter infrastructure products, including servers, storage and switches.
The company, based in New Taipei City’s Sijhih District (汐止), said that plans to expand capacity in Taiwan, Malaysia and Mexico remain on track, and it would continue to reduce the proportion of its assembly business in China in light of Beijing’s “zero COVID-19” policy and amid rising trade tensions between China and the US.
Photo courtesy of Wiwynn Corp
Wiwynn told an online investors’ conference that construction of a server printed circuit board assembly plant for cloud data centers in Johor, Malaysia, is expected to be finished next year, while motherboard assembly operations would start the following year.
The Malaysian plant is to be one of Wiwynn’s production hubs, providing complete services for Asia, including Malaysia, India, Australia and Northeast Asia, it said.
In Taiwan, the company is expanding motherboard production lines in Tainan and building a new system assembly plant in Kaohsiung, both of which are expected to be finished next year, it said.
“As the cloud-services trend is still on the rise from a long-term perspective, Wiwynn’s plans to expand production capacity have not changed,” the Chinese-language news site MoneyDJ.com quoted chief financial officer Harry Chen (陳昌偉) as saying yesterday.
“With cloud demand continuing, it is no longer enough to work overtime to meet customer needs. The company still needs to expand production and prepare more production capacity in response to long-term needs,” Chen said.
Microsoft Corp, Meta Platforms Inc and Amazon.com Inc are among the company’s major customers, it said.
Wiwynn on Tuesday posted a record net profit of NT$4.32 billion (US$134.29 million) last quarter, up 21.1 percent from the previous quarter and soaring 112.9 percent from a year earlier, the company said in a regulatory filing.
That translated into earnings per share of NT$24.68, up from NT$20.38 the previous quarter and NT$11.59 a year earlier.
Revenue rose 6.2 percent quarterly and 76 percent year-on-year to a record high NT$79.67 billion during the quarter, with gross margin of 8.1 percent and operating margin of 6.1 percent.
In the first three quarters, net profit totaled NT$10.22 billion, up 69.4 percent from NT$6.03 billion a year earlier, with earnings per share rising from NT$34.51 to NT$58.48, while revenue rose 51.3 percent to NT$205.44 billion. Gross margin was flat at 8.1 percent, while operating margin edged up 0.1 percentage points to 6 percent.
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