Wiwynn Corp (緯穎科技) is to continue capacity expansion to meet market demand, the maker of cloud-based servers and hyperscale data centers said yesterday, adding that the growth momentum of artificial intelligence (AI) servers would remain strong next year.
The company’s non-current assets including factories account for 10 percent of total assets, indicating that Wiwynn has actively and continuously expanded its production capacity in recent years, chief financial officer Harry Chen (陳昌偉) told investors yesterday.
Chen said the company’s board of directors on Monday approved a plan to lease land on the Tainan campus of the Southern Taiwan Science Park and build a new factory there to produce server circuit boards and for testing and certifying new products including AI servers and cloud-based devices.
Photo courtesy of Wiwynn Corp
The construction cost is estimated at about NT$6.2 billion (US$192.6 million), he said.
The new investment comes as the company installed more production equipment at its existing factory in Tainan this month as market demand continues to rise, Wiwynn said.
The company started construction of its first factory in Malaysia in the third quarter of this year, mainly for systems integration services, it said. The second factory in Malaysia, primarily for the production of motherboards, is expected to begin production in the second half of next year, it added.
The company also plans to expand capacity at its factories in Mexico to enhance supply chain resilience, it said.
Wiwynn reported a net profit of NT$2.62 billion (US$81.4 million) in the July-to-September quarter, flat from the previous quarter but down 39.4 percent from NT$4.32 billion a year earlier, with earnings per share of NT$14.96.
Gross margin improved to 9.6 percent in the third quarter, compared with 8.8 percent in the previous quarter and 8.1 percent a year ago. Last quarter’s gross margin was the company’s best quarterly figure since its Taiwan Stock Exchange debut in late March 2019.
During the first three quarters of this year, net profit contracted 16.6 percent to NT$8.53 billion, from NT$10.22 billion a year ago, with earnings per share dropping to NT$48.78 from NT$58.48.
Third-quarter revenue dropped 33.7 percent year-on-year to NT$52.82 billion and cumulative revenue in the first three quarters fell 10.8 percent annually to NT$183.35 billion.
Chen said the annual decrease in revenue in the third quarter was not unexpected, but added that AI server revenue exceeded 10 percent of its total revenue in the quarter, meeting the company’s expectations.
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