AU Optronics Corp (友達光電), the world’s third-largest maker of liquid-crystal-display (LCD) panels, yesterday said quarterly losses narrowed in the first quarter as improving demand for TV sets helped stabilize panel prices.
The Hsinchu-based company said the nascent recovery could extend into this quarter and boost factory usage to nearly 100 percent.
Losses were NT$20.22 billion (US$598 million) in the quarter ending March 31, compared with NT$26.6 billion in the final quarter of last year, AU Optronics said, marking a second straight quarterly loss.
A year ago, AU Optronics earned NT$26.99 billion.
“We think the worst of the situation has passed and the company’s operation and revenues will improve month by month ... We now have strong confidence in the remaining months of the year,” company president Chen Lai-juh (陳來助) told an investors’ conference.
A recovery in demand was gradually taking hold as “rush orders are mostly the result of [upward] revisions by customers to their business plans for this year ... rather than simply inventory buildup,” Chen said.
This quarter, shipments of TV and computer panels may grow 50 percent from 13.1 million units in the first quarter, helped in part by China’s plan to subsidize purchases of home appliances in rural areas, AU Optronics said.
“We are seeing orders and demand increase, primarily from North America and emerging markets such as China, Brazil and Southeast Asian countries,” Paul Peng (彭雙浪), a vice president of AU Optronics, said on the sidelines of the conference.
Reflecting the rebound in demand, the company’s factory utilization rate may approach 100 percent this quarter, compared with 65 percent in the first quarter, it said, catching up with South Korean rival LG Display Co, which projects utilization to rise from 80 percent to 93 percent.
“AU Optronics gave surprisingly good guidance in terms of shipment growth and equipment utilization rate,” said Jeff Pu (蒲得宇), a panel industry analyst with Yuanta Securities (元大證券).
“But we are concerned that a significant increase may be driven mostly by inventory stocking rather than a strong recovery in end demand. Expanding [production] capacity too much could cause a renewed inventory problem in the third quarter, stifling the budding rise in prices,” Pu said.
He retained a “hold” rating on shares of AU Optronics.
Panel prices may climb between 5 percent and 7 percent quarter-on-quarter in the second quarter after average selling prices for TV and PC panels held steady at US$97 per unit last quarter, AU Optronics said.
To cope with fresh demand, AU Optronics planned to start producing panels at a new 8.5-generation plant one month ahead of schedule, Chen said.
To fund capacity expansion, AU Optronics yesterday raised its capital budget for this year from NT$50 billion to NT$60 billion.
Shares of AU Optronics jumped 2.47 percent to NT$35.25 yesterday, while rival Chi Mei Optoelectronics Corp (奇美電子) advanced 3.24 percent to NT$19.1.
PROTECTION: The investigation, which takes aim at exporters such as Canada, Germany and Brazil, came days after Trump unveiled tariff hikes on steel and aluminum products US President Donald Trump on Saturday ordered a probe into potential tariffs on lumber imports — a move threatening to stoke trade tensions — while also pushing for a domestic supply boost. Trump signed an executive order instructing US Secretary of Commerce Howard Lutnick to begin an investigation “to determine the effects on the national security of imports of timber, lumber and their derivative products.” The study might result in new tariffs being imposed, which would pile on top of existing levies. The investigation takes aim at exporters like Canada, Germany and Brazil, with White House officials earlier accusing these economies of
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) would not produce its most advanced technologies in the US next year, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. Kuo made the comment during an appearance at the legislature, hours after the chipmaker announced that it would invest an additional US$100 billion to expand its manufacturing operations in the US. Asked by Taiwan People’s Party Legislator-at-large Chang Chi-kai (張啟楷) if TSMC would allow its most advanced technologies, the yet-to-be-released 2-nanometer and 1.6-nanometer processes, to go to the US in the near term, Kuo denied it. TSMC recently opened its first US factory, which produces 4-nanometer
Teleperformance SE, the largest call-center operator in the world, is rolling out an artificial intelligence (AI) system that softens English-speaking Indian workers’ accents in real time in a move the company claims would make them more understandable. The technology, called accent translation, coupled with background noise cancelation, is being deployed in call centers in India, where workers provide customer support to some of Teleperformance’s international clients. The company provides outsourced customer support and content moderation to global companies including Apple Inc, ByteDance Ltd’s (字節跳動) TikTok and Samsung Electronics Co Ltd. “When you have an Indian agent on the line, sometimes it’s hard
‘SACRED MOUNTAIN’: The chipmaker can form joint ventures abroad, except in China, but like other firms, it needs government approval for large investments Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) needs government permission for any overseas joint ventures (JVs), but there are no restrictions on making the most advanced chips overseas other than for China, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. US media have said that TSMC, the world’s largest contract chipmaker and a major supplier to companies such as Apple Inc and Nvidia Corp, has been in talks for a stake in Intel Corp. Neither company has confirmed the talks, but US President Donald Trump has accused Taiwan of taking away the US’ semiconductor business and said he wants the industry back
RSS