Yageo Corp (國巨), the world’s third-largest supplier of multilayer ceramic capacitors (MLCCs), yesterday projected that its revenue would be little changed this quarter and the next on a sequential basis, as signs of an exuberant recovery are lacking.
With a lukewarm increase in end-market demand, the passive components maker expects channel inventory adjustments to continue for another one to two quarters.
Yageo’s conservative outlook came as the firm reported its weakest profit in nine quarters last quarter.
Photo: Chang Hui-wen, Taipei Times
Net profit for the April-to-June quarter tumbled 37 percent to NT$3.73 billion (US$119.15 million), from NT$5.93 billion in the same period last year. That represented a decline of 9.7 percent from NT$4.13 billion a quarter earlier.
“The current market [condition] seems to have reached the bottom. However, we haven’t seen signs of very strong demand yet,” Yageo CEO David Wang (王淡如) told an online investors’ conference.
Revenue would be flat this quarter compared with NT$26.76 billion a quarter earlier, Wang said, adding that gross margin would be flat, or improve slightly from 33.2 percent last quarter.
Overall, Yageo expects to generate more revenue in the second half of the year than the first half, Wang said.
To cope with tepid market demand while reducing its inventory further, Yageo would extend its one-year factory utilization control policy into this quarter, the company said.
The day-of inventory gauge stood at 129 days last quarter, higher than the firm’s target of fewer than 120 days, it said.
The utilization of manufacturing equipment for premier passive components would remain at about 70 percent this quarter — the same as last quarter, Yageo said, adding that the usage of manufacturing equipment for commodity-type products would be 40 to 50 percent.
Yageo said it has recently seen signs of a recovery in its MLCC business, as customers have started restocking inventory lately.
The company’s MLCC business was its second-largest revenue contributor last quarter, accounting for 22 percent of its total sales.
Demand from the car, electric vehicle and industrial segments would remain robust in the second half of the year, extending the growth recorded in the first half, Yageo executive vice president of global sales and marketing Claudio Lollini said.
However, the demand profile for desktop computers, notebook computers and smartphones remains lackluster, Lollini said.
Yageo did not see any major decline in its average selling prices, aside from seasonal adjustments, he added.
Lollini said it would be difficult to quantify how many business opportunities the adoption of artificial intelligence chips would bring to the company, but it is certain that each AI server is equipped with many more components than a traditional server.
Yageo’s MLCCs and chip resistors have exposure to the AI market, he added.
DIVIDED VIEWS: Although the Fed agreed on holding rates steady, some officials see no rate cuts for this year, while 10 policymakers foresee two or more cuts There are a lot of unknowns about the outlook for the economy and interest rates, but US Federal Reserve Chair Jerome Powell signaled at least one thing seems certain: Higher prices are coming. Fed policymakers voted unanimously to hold interest rates steady at a range of 4.25 percent to 4.50 percent for a fourth straight meeting on Wednesday, as they await clarity on whether tariffs would leave a one-time or more lasting mark on inflation. Powell said it is still unclear how much of the bill would fall on the shoulders of consumers, but he expects to learn more about tariffs
Meta Platforms Inc offered US$100 million bonuses to OpenAI employees in an unsuccessful bid to poach the ChatGPT maker’s talent and strengthen its own generative artificial intelligence (AI) teams, OpenAI CEO Sam Altman has said. Facebook’s parent company — a competitor of OpenAI — also offered “giant” annual salaries exceeding US$100 million to OpenAI staffers, Altman said in an interview on the Uncapped with Jack Altman podcast released on Tuesday. “It is crazy,” Sam Altman told his brother Jack in the interview. “I’m really happy that at least so far none of our best people have decided to take them
NOT JUSTIFIED: The bank’s governor said there would only be a rate cut if inflation falls below 1.5% and economic conditions deteriorate, which have not been detected The central bank yesterday kept its key interest rates unchanged for a fifth consecutive quarter, aligning with market expectations, while slightly lowering its inflation outlook amid signs of cooling price pressures. The move came after the US Federal Reserve held rates steady overnight, despite pressure from US President Donald Trump to cut borrowing costs. Central bank board members unanimously voted to maintain the discount rate at 2 percent, the secured loan rate at 2.375 percent and the overnight lending rate at 4.25 percent. “We consider the policy decision appropriate, although it suggests tightening leaning after factoring in slackening inflation and stable GDP growth,”
PLANS: MSI is also planning to upgrade its service center in the Netherlands Micro-Star International Co (MSI, 微星) yesterday said it plans to set up a server assembly line at its Poland service center this year at the earliest. The computer and peripherals manufacturer expects that the new server assembly line would shorten transportation times in shipments to European countries, a company spokesperson told the Taipei Times by telephone. MSI manufactures motherboards, graphics cards, notebook computers, servers, optical storage devices and communication devices. The company operates plants in Taiwan and China, and runs a global network of service centers. The company is also considering upgrading its service center in the Netherlands into a
RSS