GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, expects improved revenue growth next year on the back of a healthier supply chain inventory and improving semiconductor demand, as inflationary pressures have begun to abate.
The Hsinchu-based company said it did not have sufficient evidence to support expectations of a dramatic recovery next year, but it expects it to be a “promising” year based on orders from customers, GlobalWafers chairwoman Doris Hsu (徐秀蘭) told reporters on the sidelines of the company’s annual general meeting yesterday.
There are also signs that the global economy might improve and central banks might halt their interest rate hikes next year after inflationary pressures subside, Hsu said.
Photo: Grace Hung, Taipei Times
Semiconductor demand is closely correlated to the global economy and consumer spending on everything from smartphones to vehicles to refrigerators, Hsu said.
All those devices are equipped with chips, she said.
“The expected improvement in the company’s business is based on long-term supply agreements signed with our customers. Those orders suggest that a major [positive] adjustment should come next year, and business should pick up,” Hsu said.
“We continue collecting prepayments from customers for wafer shipments at later dates,” she added.
The company is expanding wafer capacity at its fabs in six countries, including Denmark, Italy and Japan, and building an advanced 12-inch fab in the US, Hsu said.
GlobalWafers has filed a pre-application for subsidies under the US’ Creating Helpful Incentives to Produce Semiconductors (CHIPS) and Science Act, she said.
Its new fab in Texas is to enter volume production in 2025 as scheduled and employ 1,500 people, Hsu said.
GlobalWafers expects mild fluctuations this year, as high inflation curbs consumer spending and inventories remain high in the supply chain, Hsu said.
Revenue this quarter could drop slightly from last quarter’s NT$18.62 billion (US$602.78 million), and the downtrend might extend into next quarter before a moderate improvement in the fourth quarter, she said.
However, the company still aims to grow its revenue this year compared with NT$70.29 billion last year, although the growth rate might not be as significant as it expected, Hsu said.
While chips for smartphones remain a weak spot, demand for chips used in vehicles, power units for electricity grids and other devices is robust, Hsu said, adding that GlobalWafers is to double its capacity of silicon carbide (SiC) and boost float-zone silicon wafer capacity at its Denmark fab to meet customer demand.
The company is maintianing its factory utilization rate at a reasonable level of 80 to 90 percent, GlobalWafers said.
Shareholders yesterday approved a plan to distribute a cash dividend of NT$16 per share. That represents a payout ratio of 45 percent based on the company’s earnings per share of NT$35.31 last year.
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