Siliconware Precision Industries Co (矽品), the world’s second-biggest chip packager, yesterday slashed its sales outlook for the current quarter, echoing a move by its larger rival a day earlier because of decreased orders amid the deteriorating global economy.
In a stock exchange filing, Siliconware said its revenue could drop 25 percent to 28 percent in the October-December quarter, from NT$17.24 billion (US$13.1 million) the previous quarter.
On Oct. 29, company chairman Lin Wen-po (林文伯) said via Webcast that he expected a quarterly decline of between 8 percent and 13 percent in the fourth quarter.
Yesterday’s filing said that the firm’s operating margin could fall to between 7 percent and 9 percent in this quarter from 18 percent in the July-September period.
On Oct. 29, Siliconware said it expected operating margin to drop by between 14 percent and 16 percent in the fourth quarter from the third-quarter.
The Taichung-based chip company yesterday also posted NT$4.23 billion in sales last month, a 28.3 percent drop from a year earlier and a 24 percent decline from NT$5.57 billion in October.
Siliconware’s sales outlook adjustment came after Advanced Semiconductor Engineering Inc (ASE, 日月光半導體) announced on Tuesday that it would lower its sales estimate for the fourth quarter by between 25 percent and 28 percent quarter-on-quarter, compared to its previous forecast of a decline of between 15 percent and 20 percent.
ASE, the world’s biggest computer chip packager, also cut its gross margin forecast to between 14 percent and 15 percent from its earlier estimate of 20 percent.
In response to ASE’s downward adjustment, BNP Paribas yesterday downgraded its recommendation on the stock to “reduce” from “hold,” while Citigroup said it maintained its “sell” rating on the Kaohsiung-based firm, the two foreign brokerages said in investment notes yesterday.
BNP cuts its target price for ASE to NT$7.20, down from its previous estimate of NT$15.30, while Citigroup kept its target price at NT$8, the notes showed. Shares of ASE closed at NT$9.86 yesterday.
As order visibility remains low, the chip packagers could see further declining sales in the first two quarters of the next year, SinoPac Securities Corp (永豐金證券) said in a client note yesterday.
The local brokerage said investors should avoid ASE shares in the near term considering the bleak outlook.
While Siliconware is better than its stronger rival at cost management, SinoPac said investors should not load up on Siliconware shares until the stock’s prices drops to NT$15. Yesterday the stock closed at NT$23.05.
Taiwan’s technology protection rules prohibits Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) from producing 2-nanometer chips abroad, so the company must keep its most cutting-edge technology at home, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. Kuo made the remarks in response to concerns that TSMC might be forced to produce advanced 2-nanometer chips at its fabs in Arizona ahead of schedule after former US president Donald Trump was re-elected as the next US president on Tuesday. “Since Taiwan has related regulations to protect its own technologies, TSMC cannot produce 2-nanometer chips overseas currently,” Kuo said at a meeting of the legislature’s
TECH WAR CONTINUES: The suspension of TSMC AI chips and GPUs would be a heavy blow to China’s chip designers and would affect its competitive edge Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s biggest contract chipmaker, is reportedly to halt supply of artificial intelligence (AI) chips and graphics processing units (GPUs) made on 7-nanometer or more advanced process technologies from next week in order to comply with US Department of Commerce rules. TSMC has sent e-mails to its Chinese AI customers, informing them about the suspension starting on Monday, Chinese online news outlet Ijiwei.com (愛集微) reported yesterday. The US Department of Commerce has not formally unveiled further semiconductor measures against China yet. “TSMC does not comment on market rumors. TSMC is a law-abiding company and we are
FLEXIBLE: Taiwan can develop its own ground station equipment, and has highly competitive manufacturers and suppliers with diversified production, the MOEA said The Ministry of Economic Affairs (MOEA) yesterday disputed reports that suppliers to US-based Space Exploration Technologies Corp (SpaceX) had been asked to move production out of Taiwan. Reuters had reported on Tuesday last week that Elon Musk-owned SpaceX had asked their manufacturers to produce outside of Taiwan given geopolitical risks and that at least one Taiwanese supplier had been pushed to relocate production to Vietnam. SpaceX’s requests place a renewed focus on the contentious relationship Musk has had with Taiwan, especially after he said last year that Taiwan is an “integral part” of China, sparking sharp criticism from Taiwanese authorities. The ministry said
US President Joe Biden’s administration is racing to complete CHIPS and Science Act agreements with companies such as Intel Corp and Samsung Electronics Co, aiming to shore up one of its signature initiatives before US president-elect Donald Trump enters the White House. The US Department of Commerce has allocated more than 90 percent of the US$39 billion in grants under the act, a landmark law enacted in 2022 designed to rebuild the domestic chip industry. However, the agency has only announced one binding agreement so far. The next two months would prove critical for more than 20 companies still in the process
RSS