AU Optronics Corp (AUO, 友達光電) yesterday said the first quarter of this year was its best first quarter in the past nine years as persistent inventory buildup demand for TV panels pushed prices higher.
The LCD panel maker’s net profit expanded about 5.7 percent to NT$9.48 billion (US$314.4 million), compared with NT$8.97 billion in the fourth quarter of last year, the company’s financial statement showed.
In the first quarter of last year, the company lost NT$5.48 billion.
Average selling prices for the company’s products rose 2 percent in the first quarter to US$421 per square meter, up from US$413 per square meter in the fourth quarter of last year.
That represents an annual jump of 20.63 percent.
“TV vendors continued to replenish inventory in the first quarter. Robust demand has caused a supply crunch,” AUO chairman and chief executive officer Paul Peng (彭双浪) told investors.
“The robust demand is to extend into the second quarter. AUO expects its equipment loading rate to remain at a high gear, or to be almost fully loaded,” he said.
“This will be the longest boom period in the LCD industry’s history. We expect the prosperity to be in place for some time,” he said.
The company said it expects demand growth to outpace supply by about 2 percent this year.
However, it is keeping its capital spending for this year at NT$55 billion, as planned at end of last year.
AUO expects its shipments of PC and TV panels this quarter to shrink by a low-single-digit percentage by unit as it is to ship more large-size and high-end TV panels, such as 65-inch TV panels and 55-inch ultra-high-definition 4K TV panels, which will consume more capacity.
“As TV sets become slimmer, the uptake of 65-inch and 70-inch TVs is improving,” AUO president Michael Tsai (蔡國新) said. “Clients are also asking for more supply of such panels.”
Prices for TV panels are expected to rise by a low-single digit percentage this quarter from last quarter, AUO said.
However, exchange rates might have a greater impact on the company’s business in the first half of the year, Peng said.
A stronger New Taiwan dollar would weaken AUO’s price competitiveness, he said.
Against the US dollar, the NT dollar appreciated 5.6 percent in the first quarter of the year, faster than South Korean won’s 4.1 percent, while Chinese yuan fell 5.3 percent, he said.
AUO also said it has made significant progress this year in expanding its client base for OLED panels.
Monthly shipments of OLED panels for wearable devices, mostly smart watches, are expected to reach 1 million units in the second half of the year, the company said.
CHIP WAR: Tariffs on Taiwanese chips would prompt companies to move their factories, but not necessarily to the US, unleashing a ‘global cross-sector tariff war’ US President Donald Trump would “shoot himself in the foot” if he follows through on his recent pledge to impose higher tariffs on Taiwanese and other foreign semiconductors entering the US, analysts said. Trump’s plans to raise tariffs on chips manufactured in Taiwan to as high as 100 percent would backfire, macroeconomist Henry Wu (吳嘉隆) said. He would “shoot himself in the foot,” Wu said on Saturday, as such economic measures would lead Taiwanese chip suppliers to pass on additional costs to their US clients and consumers, and ultimately cause another wave of inflation. Trump has claimed that Taiwan took up to
A start-up in Mexico is trying to help get a handle on one coastal city’s plastic waste problem by converting it into gasoline, diesel and other fuels. With less than 10 percent of the world’s plastics being recycled, Petgas’ idea is that rather than letting discarded plastic become waste, it can become productive again as fuel. Petgas developed a machine in the port city of Boca del Rio that uses pyrolysis, a thermodynamic process that heats plastics in the absence of oxygen, breaking it down to produce gasoline, diesel, kerosene, paraffin and coke. Petgas chief technology officer Carlos Parraguirre Diaz said that in
SUPPORT: The government said it would help firms deal with supply disruptions, after Trump signed orders imposing tariffs of 25 percent on imports from Canada and Mexico The government pledged to help companies with operations in Mexico, such as iPhone assembler Hon Hai Precision Industry Co (鴻海精密), also known as Foxconn Technology Group (富士康科技集團), shift production lines and investment if needed to deal with higher US tariffs. The Ministry of Economic Affairs yesterday announced measures to help local firms cope with the US tariff increases on Canada, Mexico, China and other potential areas. The ministry said that it would establish an investment and trade service center in the US to help Taiwanese firms assess the investment environment in different US states, plan supply chain relocation strategies and
Japan intends to closely monitor the impact on its currency of US President Donald Trump’s new tariffs and is worried about the international fallout from the trade imposts, Japanese Minister of Finance Katsunobu Kato said. “We need to carefully see how the exchange rate and other factors will be affected and what form US monetary policy will take in the future,” Kato said yesterday in an interview with Fuji Television. Japan is very concerned about how the tariffs might impact the global economy, he added. Kato spoke as nations and firms brace for potential repercussions after Trump unleashed the first salvo of
RSS