Chipmaker Nanya Technology Corp (南亞科技) yesterday said it is aiming to swing back into profit in the second half of this year, from losses of NT$7.45 billion (US$239.24 million) last year, as improving demand for DRAM chips used in artificial intelligence (AI) devices helps reduce supply chain inventory.
As the world’s major memorychip makers are concentrating on shifting capacity to next-generation DDR5 and high-band-memory chips mostly used in AI devices and servers, the supply of mainstream DDR4 chips is slowing, Nanya Technology said.
The shift is also leading to faster inventory digestion throughout the supply chain and triggered a price rebound for memory chips last quarter, it said.
Photo: Grace Hung, Taipei Times
Average selling prices rose by a low single-digit percentage sequentially last quarter, the first uptick in about two years, Nanya Technology president Lee Pei-ing (李培瑛) said.
The uptrend is likely to continue for the rest of this year, Lee said.
“AI PCs and AI smartphones are boosting demand for DRAM chips,” Lee said. “Demand for smartphones in China is also picking up after a trough.”
DRAM chips are to bounce back at a faster rate this quarter than last quarter, he said.
To align with improving demand, Nanya Technology said it is moderating its production. The New Taipei City-based company cut its factory utilization by about 20 percent over the past few quarters to cope with sluggish demand.
The company plans to produce its first DDR5 chips in the third quarter of this year, targeting PC and server applications. The company currently primarily supplies DDR4 and DDR3 chips.
Overall shipments are projected to grow 20 percent year-on-year, reversing a mid-single-digit percentage fall last year, the company said.
Nanya Technology said it plans to budget capital expenditure of NT$20 billion this year, compared with NT$13.1 billion last year.
The company yesterday reported a quarterly loss of NT$2.49 billion last quarter, compared with a loss of NT$2.51 billion the previous quarter.
Gross margin improved to minus-13.6 percent last quarter, from minus-25.2 percent the prior quarter, on the back of better chip prices and lower losses from idled capacity.
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