Alchip Technologies Ltd (世芯), which designs application-specific ICs for other companies, yesterday saw its shares fall by the maximum daily limit of 10 percent for the fourth consecutive session after a key customer was blacklisted by the US Department of Commerce’s Bureau of Industry and Security on Thursday last week.
Alchip on Tuesday said that it had stopped shipments to Chinese semiconductor company Phytium Information Technology Co (飛騰信息技術), which was placed on the US entity list along with six other Chinese companies.
However, the company’s share price yesterday, after continuing to fall, closed at NT$593, down 9.88 percent.
Photo: Aly Song, Reuters
Its share price has plunged 34.26 percent over the past four sessions, Taiwan Stock Exchange data showed.
Yesterday, in a filing with the stock exchange regulator — required due to the volatility of the share price over the past few sessions — Alchip reported that net profit last month increased 85.75 percent year-on-year to NT$143 million (US$5.03 million), while revenue increased 66.06 percent to NT$1.033 billion.
Earnings per share last month were NT$2.05, up 70.45 percent from a year earlier, the company filing said.
In the first quarter, net profit increased 122.79 percent to NT$388 million from a year earlier, while revenue rose 74.92 percent to NT$2.66 billion, the company said.
Earnings per share in the first quarter jumped 98.03 percent to NT$5.68, it added.
Alchip, with 39 percent of its revenue coming from Phytium last year, on Tuesday said that this latest development could affect its revenue by as much as 25 percent this year.
The company — which forecast that revenue this year would still grow at least 20 percent from NT$7.08 billion last year — said that it is working with its US counsel to gain a clearer understanding of whether its products are subject to US export regulations.
A US Bureau of Industry and Security “permit will be obtained for Phytium’s products if necessary,” it added.
Yesterday, analysts at Capital Investment Management Corp (群益投顧) and Jih Sun Securities Investment Consulting Co (日盛投顧) said that they held a “neutral” rating on Alchip’s shares, as the company is expected to face headwinds in the near term in light of the Phytium ban, while revenue generated outside of China is unlikely to see a marked increase in the near term.
However, in the medium to long term, the company is still expected to benefit from rising demand for artificial intelligence and high-performance-computing chips, as well as the revenue contribution from 5 and 7-nanometer ASIC chips for data centers, analysts said.
Separately yesterday, Minister of Economic Affairs Wang Mei-hua (王美花) said that the nation’s chip companies would adhere to US rules after Washington last week added seven Chinese supercomputing entities to an economic blacklist.
“Our companies, whether producers or exporters, must comply with our country’s rules. Of course, the United States has new rules, and our companies will pay attention and comply with key criteria of the US rules,” Wang told reporters in Taipei.
Additional reporting by Reuters
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