GlobalWafers Co (環球晶圓), the world’s third-largest silicon wafer supplier, yesterday said that it would discuss raising wafer prices from the second half of this year with customers, as geopolitical tensions are boosting raw material, energy and logistics costs.
“The price has to be reasonable and profitable, because our manufacturing cost is so much higher than before, due to geopolitical factors,” GlobalWafers chairwoman Doris Hsu (徐秀蘭) said at an earnings conference.
While the gallium supply remains stable for chip production, its price has almost doubled from six months ago, Hsu said.
Photo courtesy of GlobalWafers Co
GlobalWafers said it is receiving positive signals from customers, indicating demand has become more pronounced.
Apart from new production lines still in the ramp-up stage, 12-inch utilization across the company’s global sites is fully committed, it said
Utilization of small and mid-diameter wafers improved, with 8-inch demand remaining strong, supported by power management and analog applications, the company said.
The pickup is extending to 6-inch wafers, improving overall capacity utilization and shipment momentum, it said.
The company said it expects depreciation costs to rise to NT$12 billion (US$379.7 million) this year and would continue to rise for several years, as more new overseas factories come online.
GlobalWafers said it has received new funding from governments past quarter, including US$318 million under the advanced manufacturing investment credit established by the US CHIPS and Science Act, as well as 30 million euros (US$35.1 million) for a subsidiary in Italy.
Without financial support from governments, GlobalWafers would still be able to maintain its gross margin at about 20 percent, Hsu said, adding that it would be more susceptible to surges in manufacturing costs.
In the first quarter, gross margin dropped to 20.8 percent, from 26.4 percent a year earlier and 25.7 percent in the previous quarter.
Net profit surged 30.2 percent annually to NT$1.9 billion, compared with NT$1.46 billion a year earlier. The figure tumbled 14 percent from NT$2.21 billion in the previous quarter.
Earnings per share jumped to NT$3.97 from NT$3.05 a year ago, but declined from NT$4.6 last quarter.
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