GlobalWafers Co (環球晶圓), the world’s third-largest silicon wafer supplier, yesterday said that net profit last quarter contracted 4 percent annually due to significant increases in logistics expenses, as many countries imposed transportation restrictions amid the COVID-19 pandemic.
Net profit fell to NT$3.4 billion (US$115.1 million), from NT$3.54 billion during the same period last year. On a quarterly basis, net profit rose 18 percent from NT$2.88 billion.
Earnings per share dropped to NT$7.81 last quarter from NT$8.16 a year earlier, but grew from NT$6.62 the previous quarter.
Gross margin fell to 38.6 percent from 40.1 percent a year earlier, but improved from 36.5 percent a quarter earlier.
GlobalWafers generated revenue of NT$27.22 billion in the first half of this year, down 10 percent year-on-year.
However, the company last quarter benefited from rush orders for medical electronic products and customers building up their inventories.
It also benefited from booming demand for e-commerce and digital services due to stay-at-home orders, while the telecommuting trend bolstered demand for computers, cloud services, servers and data centers.
The Hsinchu-based company gave a positive outlook for the second half of this year, thanks to robust customer demand for 12-inch advanced wafers and recovering demand for automotive applications, as a growing number of automakers are reopening their plants.
Revenue in the second half would be flat or increase modestly from the first half, as governments around the world pump unprecedented amounts of stimulus funds into their economies to alleviate the fallout from the COVID-19 pandemic, GlobalWafers chairperson Doris Hsu (徐秀蘭) told a teleconference yesterday.
“First, the automotive [sector] was extremely bad in the first half. We have seen some improvement from May, and we believe that automotive demand will gradually improve quarter-by-quarter in the second half. Second, 12-inch demand will be very strong,” Hsu said.
GlobalWafers also plans to ramp up a new 12-inch fab in South Korea by the fourth quarter of this year, which would boost the company’s capacity and revenue in the second half, Hsu said.
The company aims to have the new fab operating at 75 percent, she said.
GlobalWafers said that its 12-inch and 8-inch fabs are almost fully utilized, while some customers have requested capacity allocation for next year, because they are concerned about supply constraints.
The company said that customers are tending to keep their inventory levels high as part of their contingency plans for a possible second wave of COVID-19 in autumn or winter.
GlobalWafers also gave an upbeat outlook for next year.
“I think 2021 will be a very good year for the semiconductor industry, unless the COVID-19 gets really worse,” Hsu said.
Hsu said that 5G-related applications and mobile phones would be two major growth drivers next year.
The supply-demand situation for silicon wafers would be healthy next year, she added.
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