Winbond Electronics Corp (華邦電) yesterday said it is planning record capital expenditure (capex) of NT$42.1 billion (US$1.33 billion) this year as the demand for memory chips continues to rise amid the artificial intelligence (AI) boom.
This year’s capital outlay, a spike from NT$5.5 billion last year, aims to boost Winbond’s DRAM shipments by about 100 percent, and its NOR and NAND flash memory shipments by 30 percent to 40 percent year-on-year, the company said at an earnings conference in Taipei.
“Our capacities have been fully booked this year and next year, including DRAM, NOR and NAND,” Winbond president James Chen (陳沛銘) said. “The industry’s upcycle should last for quite a long time.”
Photo: Lisa Wang, Taipei Times
The memory industry’s upturn is expected to persist before global AI infrastructure deployment reaches a scaling phase, Chen said.
AI infrastructure deployments help the company tap into new business areas such as chips used in enterprise solid-state drives, he said.
To meet demand, Winbond and its peers are embarking on massive investment sprees, and the company does not expect the supply-demand gap to narrow in the short term, Chen said, given that major industry players are allocating capacities to produce higher-margin DDR5 DRAM chips and high-bandwidth memory chips used in AI servers.
Besides, AI servers consume a much larger number of memory chips than PCs, he said.
An AI server rack based on Nvidia Corp’s GB200 chips requires more than 120 NOR flash chips, equal to the consumption of 120 PCs, Chen said.
Even general purpose servers are consuming more and higher-density memory chips to handle less complex AI tasks, he said.
Winbond expects memory prices to rise more than 30 percent this quarter, following a similar hike last quarter, due to persistent supply constraints, which would further prop up the company’s gross margin, Chen said.
Gross margin this quarter is predicted to climb above the 43 percent in the fourth quarter of last year, and even exceed the 51 percent registered in the third quarter of last year, he said.
Winbond’s net profit last quarter surged 479 percent to NT$3.42 billion from NT$2.94 billion the previous quarter. That was a spike from losses of NT$648 million in the fourth quarter of 2024.
For the whole of last year, net profit soared to NT$3.96 billion, from NT$601 million in 2024.
Earnings per share rose to NT$0.88 from NT$0.14 and gross margin improved to 35 percent from 29 percent.
Revenue expanded 9.6 percent year-on-year to NT$89.41 billion last year, with 35 percent from the flash memory business and 29 percent from the DRAM business. Logic chips contributed about 34 percent, the company said.
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