Artificial intelligence (AI) chip designer Alchip Technologies Ltd (世芯) yesterday forecast that revenue would grow significantly again this year, thanks to stronger-than-expected demand from its top customer and new orders from its second-largest customer.
The Taipei-based company saw revenue more than double to US$978.39 million last year, compared with US$460.5 million in 2022, largely due to its biggest customer.
Net profit soared 73.3 percent year-on-year to US$106.58 million last year, from US$61.51 million in the prior year.
Photo: Screen grab from the Alchip Technologies Ltd Web site
Alchip, which yesterday closed at NT$4,340 — the highest on the local stock market — said that the outlook for next year is promising, based on customers’ indications.
“Demand for mass production [of chips] for high performance computing [HPC] and artificial-intelligence applications remains robust. Purchase orders from our largest customer has continued to increase,” Alchip CEO Johnny Shen (沈翔霖) told investors on Zoom.
“We are confident that the company’s business is in an excellent stage. We anticipate very strong growth for this year: 2024 will be another outstanding and record-breaking year for Alchip,” he said.
Production volume growth of AI chips for Amazon Web Services would be significant, increasing by at least 30 percent this year, Shen said.
Three months ago, Alchip expected shipments of the chip to be flat or to grow only slightly.
Additionally, the growth of chip shipments, mostly 7 nanometers and 5 nanometers, for its second-largest customer — likely Intel Corp, sources say — would be heavily dependent on the allocation of advanced chip-on-wafer-on-substrate, or CoWoS, packaging capacity from Taiwan Semiconductor Manufacturing Co (台積電), Shen said.
The more capacity it secures, the greater Alchip’s revenue upside would be, he said.
“There is a good chance that Alchip would register another strong year next year, as its second-largest customer has expressed confidence in its [Alchip’s] 5-nanometer chip design and indicated that it would continue ordering it next year,” Alchip said.
Potential changes in the competitive landscape was also a hot topic in yesterday’s call with investors, following Nvidia Corp’s announcement that it is seeking to build an ASIC unit.
“If Nvidia starts to do ASICs, it would compete with its customers who are using its standard [AI] chips. I don’t think that is the right thing to do for Nvidia,” Shen said.
Shen said he does not see why Nvidia would sacrifice higher-margin standard AI chips over ASICs.
The world’s major cloud service providers, Amazon.com and Microsoft Corp, are developing their own AI chips through ASIC companies like Alchip to reduce their dependence on Nvidia, so it makes no sense that they would seek Nvidia for ASIC supply.
“Alchip never fears competition,” Shen said.
MULTIFACETED: A task force has analyzed possible scenarios and created responses to assist domestic industries in dealing with US tariffs, the economics minister said The Executive Yuan is tomorrow to announce countermeasures to US President Donald Trump’s planned reciprocal tariffs, although the details of the plan would not be made public until Monday next week, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. The Cabinet established an economic and trade task force in November last year to deal with US trade and tariff related issues, Kuo told reporters outside the legislature in Taipei. The task force has been analyzing and evaluating all kinds of scenarios to identify suitable responses and determine how best to assist domestic industries in managing the effects of Trump’s tariffs, he
TIGHT-LIPPED: UMC said it had no merger plans at the moment, after Nikkei Asia reported that the firm and GlobalFoundries were considering restarting merger talks United Microelectronics Corp (UMC, 聯電), the world’s No. 4 contract chipmaker, yesterday launched a new US$5 billion 12-inch chip factory in Singapore as part of its latest effort to diversify its manufacturing footprint amid growing geopolitical risks. The new factory, adjacent to UMC’s existing Singapore fab in the Pasir Res Wafer Fab Park, is scheduled to enter volume production next year, utilizing mature 22-nanometer and 28-nanometer process technologies, UMC said in a statement. The company plans to invest US$5 billion during the first phase of the new fab, which would have an installed capacity of 30,000 12-inch wafers per month, it said. The
Taiwan’s official purchasing managers’ index (PMI) last month rose 0.2 percentage points to 54.2, in a second consecutive month of expansion, thanks to front-loading demand intended to avoid potential US tariff hikes, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. While short-term demand appeared robust, uncertainties rose due to US President Donald Trump’s unpredictable trade policy, CIER president Lien Hsien-ming (連賢明) told a news conference in Taipei. Taiwan’s economy this year would be characterized by high-level fluctuations and the volatility would be wilder than most expect, Lien said Demand for electronics, particularly semiconductors, continues to benefit from US technology giants’ effort
‘SWASTICAR’: Tesla CEO Elon Musk’s close association with Donald Trump has prompted opponents to brand him a ‘Nazi’ and resulted in a dramatic drop in sales Demonstrators descended on Tesla Inc dealerships across the US, and in Europe and Canada on Saturday to protest company chief Elon Musk, who has amassed extraordinary power as a top adviser to US President Donald Trump. Waving signs with messages such as “Musk is stealing our money” and “Reclaim our country,” the protests largely took place peacefully following fiery episodes of vandalism on Tesla vehicles, dealerships and other facilities in recent weeks that US officials have denounced as terrorism. Hundreds rallied on Saturday outside the Tesla dealership in Manhattan. Some blasted Musk, the world’s richest man, while others demanded the shuttering of his
RSS