WinWay Technology Co (穎崴), an IC testing interface supplier, yesterday said that revenue this quarter would be the lowest this year as customers digest inventory, but it is bullish about the outlook for next year, thanks to robust demand for artificial intelligence (AI) chips and chips used in high-performance-computing devices.
Additionally, some customers have pushed back shipments to January because of budget constraints, WinWay chairman Mark Wang (王嘉煌) told reporters before the company held a quarterly investors’ conference in Taipei.
Its North-America-based customers are showing strong demand for advanced chip testing services, such as 7-nanometer and even more advanced technology, Wang said.
Photo: Grace Hung, Taipei Times
With more companies joining existing chip companies such as Nvidia Corp and Advanced Micro Devices Inc (AMD) in developing their own AI chips or application-specific IC (ASIC) for AI applications, the market size is scaling up, he said.
Revenue contributions from North American customers are expected to increase next year, compared with 65 percent last quarter, Wang said.
“We are bullish about next year’s business outlook as information from customers indicates their optimistic view,” Wang said.
“The company is in an advantageous position to provide final test services in Taiwan after local backend chip assembly and testing service providers complete their job,” he said.
WinWay, based in Kaohsiung, said it has also made good progress in securing new orders to provide front-end wafer probing services for AI chips.
Wang said the company is in the final stage of having its probe cards used in chip-on-wafer-on-substrate, or CoWoS, technology certified, paving the way for the first commercial shipments next year.
WinWay counts AI chip suppliers Advanced Micro Devices Inc (AMD), Nvidia Corp and local smartphone chip designer MediaTek Inc (聯發科) among 200 of its active customers.
Although Nvidia on Wednesday told investors that it would take a hit from the US’ AI chip curbs this quarter, WinWay said that the impact would be manageable as customer demand remains resilient.
Besides, to cushion the hit, Nvidia told investors that it is working on new tailor-made chips that would not trigger export restrictions to China, WinWay said.
To cope with rising customer demand, WinWay is expanding capacity at its new fab in Kaohsiung to 1.5 million units of coaxial test sockets by the end of this year from 1.1 million units at present, Wang said.
WinWay is also building a new plant at the Tai Yuen Hi-Tech Industrial Park (台元科技園區) in Hsinchu County to boost probe card capacity by between 30 and 50 percent next year.
The factory is to start operation in the first quarter next year, it said.
The company is further seeking to build overseas capacity in Penang, Malaysia, to handle rush orders and provide services closer to customers, offering an option for customers to utilize its capacity outside China and Taiwan to minimize geopolitical risks.
Penang has evolved into a semiconductor testing and packaging hub with Intel Corp and Taiwan’s ASE Technology Holding Co (日月光投控) operating factories in the city.
WinWay reported that net profit plunged about 66 percent to NT$127 million (US$4.03 million) last quarter from NT$136 million in the second quarter.
In the first three quarters of this year, net profit plummeted 42 percent to NT$406 million from NT$697 million during the same period last year.
Earnings per share in the first nine months dropped 42 percent year-on-year to NT$11.84 from NT$20.43.
Gross margin held steady at 35 percent last quarter from the previous quarter, but down by 3 percentage points from 38 percent in the first quarter this year.
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