Industrial computer maker Advantech Co (研華) yesterday said its third-quarter revenue would be lower than the second quarter, as the company expects continued appreciation of the New Taiwan dollar against the US dollar, although growth momentum remains strong.
Based on an estimated exchange rate of NT$29.1 against the US dollar, the company said revenue in the third quarter would be between US$555 million and US$575 million, compared with NT$17.84 billion (US$594.9 million) the previous quarter.
The sales guidance came after the company reported its net profit in the second quarter decreased 6 percent to NT$1.99 billion from NT$2.1 billion a year earlier. Earnings per share dropped to NT$2.30 from NT$2.46, it said.
Photo: Fang Wei-chieh, Taipei Times
Gross margin in the second quarter fell 0.5 percentage points both annually and quarterly to 40 percent, as the NT dollar’s appreciation shaved 0.1 to 0.2 percentage points off the company’s gross margin, Advantech chief financial officer Eric Chen (陳清熙) told an earnings conference in Taipei.
The restructuring of Retail Technology Group Inc, a US-based unit fully owned by Advantech’s French point-of-sale subsidiary, trimmed gross margin by another 0.3 percentage points in the quarter, he said.
The company did not specify its foreign exchange losses in the second quarter, but said it posted non-operating losses of NT$630 million.
The book-to-bill ratio in the second quarter was 1.08, with regional breakdowns of 1.19 in the US, 1.03 in Europe and 1.08 in China, Chen said.
A ratio of 1.08 means that US$108 of orders were received for every US$100 of product billed during the quarter.
Revenue in the first half totaled NT$35.18 billion, up 23 percent year-on-year, and the company expects second-half revenue to account for 51 percent of full-year sales.
Advantech also expects revenue from its edge artificial intelligence (AI) business to account for 20 percent or more at the end of this year, up from 16.5 percent in the first half, amid accelerated growth.
The company has focused its edge AI business on five sectors — smart factory, energy & utility, intelligent system and autonomous mobile robot, medical, and smart services & retail.
Meanwhile, the company expects third-quarter revenue from North America to grow by a double-digit percentage year-on-year, driven by stronger sales of medical and audio-video equipment, while revenue from Europe is also projected to rise on the back of semiconductor and automotive-related orders, Chen said.
Revenue from China is expected to grow by a high-single-digit percentage, driven by stronger shipments of automated inspection equipment, he said.
Although US President Donald Trump last week announced a 20 percent tariff on Taiwanese goods, set to take effect today, the impact on most of Advantech’s products would depend on the outcome of the ongoing Section 232 investigation under the US Trade Expansion Act of 1962, Chen said.
The company expects continued tariff-related uncertainty in the second half, but plans to pass most of the costs on to clients, while negotiating cost-sharing with a few, he said.
Clients have not adjusted their US expansion plans amid tariff uncertainties, the company said.
Contract chipmaker United Microelectronics Corp (UMC, 聯電) yesterday said it has signed a memorandum of understanding (MOU) with Polar Semiconductor LLC to collaborate on the production of 8-inch wafers in the US. The collaboration aims to strengthen 8-inch wafer manufacturing in the US amid Washington’s efforts to increase onshore manufacturing of semiconductors, contribute to supply chain resilience against shifting geopolitical dynamics, and ensure a secure domestic supply of power semiconductors critical to automotive, electric grids, robotic manufacturing and data centers, the companies said in a joint statement. Under the MOU, Polar and UMC will identify devices for Polar to manufacture at
TECH TITANS: Amazon’s latest chip joins Google in competing for the 90 percent market share held by Nvidia, which claims it is ‘a generation ahead of the industry’ Amazon Web Services (AWS) on Tuesday launched its in-house-built Trainium3 artificial intelligence (AI) chip, marking a significant push to compete with Nvidia Corp in the lucrative market for AI computing power. The move intensifies competition in the AI chip market, where Nvidia dominates with an estimated 80 to 90 percent market share for products used in training large language models that power the likes of ChatGPT. Google last week caused tremors in the industry when it was reported that Facebook-parent Meta Platforms Inc would employ Google AI chips in data centers, signaling new competition for Nvidia. This followed the release last month of
INSULATED: The company said it is less exposed to global complications, as it has built a strong footprint worldwide, and has multiple sources of rare earths and raw minerals Merck Group yesterday said it would ramp up production next year at its new flagship facility in Kaohsiung’s Lujhu District (路竹) to satisfy growing demand for advanced semiconductor materials and specialty gases, and to address supply resilience issues amid mounting geopolitical risks. Merck made the remarks during a news conference before the inauguration of its 500 million euros (US$582.1 million) facility, which is also to supply other markets in the Asia-Pacific region, it said. Merck executive board deputy chair and electronics CEO Kai Beckmann told reporters the company adopted a “local-for-local” strategy about seven years ago to address the cycle time of
Two companies wholly owned by the daughter of the founder of Hon Hai Precision Industry Co (鴻海精密) on Monday reported to the Taiwan Stock Exchange that they would dispose of all of the Hon Hai shares they hold. In filings with the exchange, Hong Wei Investment Co (鋐維) said it would sell the 2.771 million Hon Hai shares it holds and Frontier Investment Corp (承鋒投資) said it would sell its 2.409 million Hon Hai shares from tomorrow until Jan. 3 next year. The two companies are wholly owned and chaired by Shirley Gou (郭曉玲), the eldest daughter of Hon Hai founder Terry
RSS