Largan Precision Co (大立光), a major camera lens supplier for Apple Inc’s iPhones, yesterday said net profit last quarter spiked about 60 percent sequentially thanks to a pickup in demand for new premium smartphones, and the positive momentum would carry through next month.
Net profit surged to NT$5.95 billion (US$185.21 million) in the July-to-September quarter, compared with NT$3.7 billion in the previous quarter, Largan said.
However, on an annual basis, net profit sank about 27 percent from NT$8.14 billion as wobbling economic growth and high inflation dampened demand for upscale smartphones, the company said.
Photo: David Chang, EPA-EFE
The Taichung-based company said earnings per share last quarter jumped to NT$49.6 from NT$27.69 a quarter earlier, but declined from NT$61.01 in the third quarter of last year.
“Demand for high-end smartphones improved a bit,” Largan chairman and CEO Adam Lin (林恩平) told an online investors’ conference yesterday.
He said the market is not as pessimistic as before, though it has not turned totally optimistic.
With high-end smartphone demand gradually catching up, multiple clients are adding new orders for camera lenses, Lin said.
That bodes well for the company’s revenue, which he said would likely increase this month and next month.
Largan should benefit from strong sales of Apple’s iPhone 15 series and Huawei Technologies Co’s (華為) Mate 60 smartphones, TF International Securities Group Co (天風國際證券) analyst Kuo Ming-chi (郭明錤) said last week.
As firms in the smartphone supply chain continue to deal with inventory issues, both phone vendors and component suppliers are seeing their inventories return to healthy levels, Largan said.
However, the company’s gross margin last quarter, dipped to 42.6 percent, hitting the lowest in about a decade, compared with 49.32 percent in the second quarter and 49.34 percent in the third quarter last year. Largan blamed the fall on lower yields and larger price cuts on existing camera lenses.
Last quarter could be the trough as Largan is striving to boost yields rate for its new periscope lens production, while there is scant room for further price cuts, Lin said.
As the demand in smartphone sector has been low for a while, Largan has put off the construction of a new factory in Taichung, the company said.
The construction of the new NT$20 billion factory is to be completed next month, a delay from the company’s original schedule in the first quarter. Largan is in no rush to operate the new factory, given current market demand, Lin said.
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday obtained the government’s approval to inject an additional US$7.5 billion into its US subsidiary, the Department of Investment Review said in a statement. The department approved TSMC’s application of investing in TSMC Arizona Corp, which is engaged in the manufacturing, sales, testing and design of IC and other semiconductor devices, it said. The latest capital injection follows a US$5 billion investment for TSMC Arizona approved in June. The chipmaker has broken ground on two advanced fabs in Arizona with aggregated investments approved by the department totaling US$24 billion thus far. According to TSMC, the first Arizona
The lethal hack of Hezbollah’s Asian-branded pagers and walkie-talkies has sparked an intense search for the devices’ path, revealing a murky market for older technologies where buyers might have few assurances about what they are getting. While supply chains and distribution channels for higher-margin and newer products are tightly managed, that is not the case for older electronics from Asia where counterfeiting, surplus inventories and complex contract manufacturing deals can sometimes make it impossible to identify the source of a product, analysts and consultants say. The response from the companies at the center of the booby-trapped gadgets that killed 37
FRIENDLY TAKEOVER: While Qualcomm Inc’s proposal to buy some or all of Intel raises the prospect of other competitors, Broadcom Inc is staying on the sidelines Qualcomm Inc has approached Intel Corp to discuss a potential acquisition of the struggling chipmaker, people with knowledge of the matter said, raising the prospect of one of the biggest-ever merger and acquisition deals. California-based Qualcomm proposed a friendly takeover for Intel in recent days, said the sources, who asked not to be identified discussing confidential information. The proposal is for all of the chipmaker, although Qualcomm has not ruled out buying some parts of Intel and selling off others. It is uncertain whether the initial approach would lead to an agreement and any deal is likely to come under close antitrust scrutiny
SECURITY CONCERNS: The proposed ban on Chinese autonomous vehicle software and hardware would go into effect with the 2027 and 2030 model years respectively The US Department of Commerce today is expected to propose prohibiting Chinese software and hardware in connected and autonomous vehicles on US roads due to national security concerns, two sources said. US President Joe Biden’s administration has raised concerns about the collection of data by Chinese companies on US drivers and infrastructure as well as the potential foreign manipulation of vehicles connected to the Internet and navigation systems. The proposed regulation would ban the import and sale of vehicles from China with key communications or automated driving system software or hardware, said the two sources, who declined to be identified because the