Macronix International Co (旺宏電子), the world’s biggest supplier of NOR flash memory chips, yesterday gave an upbeat outlook for the second half of this year, citing voracious demand for memory chips used in vehicles, medical and industrial devices, and servers.
The Hsinchu-based chipmaker’s optimism went against a downward correction that a wide range of local electronics manufactures face due to sluggish demand for computers amid increasing global inflation and supply chains disruptions mainly due to COVID-19 lockdowns in China.
“About 80 percent of our business is not related to PCs and that business is stable,” Macronix chairman and chief executive officer Miin Wu (吳敏求) told a virtual media briefing. “We feel that our customers are doing quite well, based on input from customers in Europe, the US and Japan.”
Photo: George Tsorng, Taipei Times
With the high season approaching, Macronix is in talks with customers about new orders and expects NOR flash chip prices to be flat or to rise next quarter, extending the trend this quarter, Wu said.
Macronix is adjusting its customer portfolios, diverting away from consumer electronics and mass market products as it seeks to improve its revenue and margins, Wu said.
The company’s strong financial results over the past few quarters have proved that the strategy is working, he said.
Growth last quarter was the fastest in Macronix’s automotive business at 75 percent from the same period last year, boosting automotive revenue contribution to 16 percent last quarter from 13 percent in the first quarter last year, company data showed.
With more electric vehicles coming to the market, demand for memory chips for such vehicles would continue to grow rapidly, Wu said.
Moreover, chip use in gasoline-powered vehicles is expected to keep increasing as automakers add applications to them, he said.
Macronix supplies NOR flash memory chips to the world’s top-tier makers of electric vehicles, including firms in the US and China, he said.
The company is developing a new 3D NOR flash memory chip targeting the automotive segment and other new applications, he said.
“Feedback from customers has been good,” Wu said. “With more automotive applications to come, we can assure you that this chip will help Macronix outshine others in the automotive segment.”
The chipmaker plans to send samples next year to customers for testing, he said.
Macronix continues to invest in research and development, and deepen its technological capability, so it would be a better company three years from now, Wu said.
The chips-for-vehicles business is very different from PCs or other consumer electronics, and it takes at least four years to reap the rewards, Wu said.
However, it usually provides six to eight years of stable chip orders and shipments, he added.
Macronix shareholders yesterday approved a cash dividend distribution of NT$1.8 per common share.
That represented a payout ratio of 27.77 percent compared with the chipmaker’s earnings per share last year of NT$6.48.
Separately, United Microelectronics Corp (UMC, 聯電), the world’s No. 3 contract chipmaker, said it is accelerating capacity expansion at home and overseas to catch up with demand.
Its new P5 manufacturing facility in Tainan entered production this quarter, UMC president Chien Shan-chieh (簡山傑) told shareholders at the company’s annual general meeting in Hsinchu yesterday.
The plant has installed capacity of 10,000 12-inch wafers, Chien said.
UMC shareholders yesterday approved a cash dividend distribution of NT$3 per common share, representing a payout ratio of 65.65 percent based on the company’s earnings per share of NT$4.75 last year.
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