ChipMOS growth momentum strengthens on Spansion orders
Taiwan News, Staff Writer
2014-05-23 03:36 PM

Spansion’s decision to enter the NOR Flash and MCU markets is expected to significantly benefit its largest packaging OEM manufacturer ChipMOS Technologies Inc. (8150). ChipMOS posted April revenue of NT$1.78 billion, a six year high. Institutional investors stated that ChipMOS will hold an investors conference May 27 and shares soared to a new high on high volume last Friday while holding the potential for future gains.

ChipMOS’s April revenue rose 2.6% compared to March and accumulated revenue from January to April was NT$6.77 billion, an annual growth rate of 13%. ChipMOS posted Q1 2014 revenue of NT$4.98 billion, gross profit margin of 19.55%, consolidated net income of NT$882 million, an annual growth rate of 101.88%, and EPS of NT$1.05. The company made big profit gains within and outside the industry. Institutional investors forecast Q2 revenue growth of 8%-10% on Q1 results.

Even though ChipMOS’s Q2 orders of COFs for large-sized LCD driver ICs is slowing, COG orders for small and mid-sized LCD driver ICs occupy all free capacity. In terms of memory, Q2 sales are up due to an influx of Mobile DRAM and NAND Flash orders from Micron Technology Inc. and new NAND Flash packaging orders from Toshiba.

ChipMOS’s other major client, Spansion underwent bankruptcy restructuring after the financial crisis and sales gradually got back on track after 2010. Since ChipMOS supported Spansion in maintaining normal sales, virtually all of Spansion’s NOR Flash volume shipment packaging orders this year have been secured by ChipMOS. Spansion has an optimistic outlook for 2014. ChipMOS stated, NOR Flash packaging orders strengthened across the board this year and benefits both revenue and profit.

In addition, it is rumored in the industry that ChipMOS has obtained a large backend packaging order from Renesas Electronics’ subsidiary IC design company RSP. It is worth noting, RSP is not only the world’s largest smartphone driver IC company, it is Apple’s primary driver IC supplier and also a major company in Samsung’s supply chain. Once this rumor is verified, it will undoubtedly be a declaration of ChipMOS’ official entry into Samsung and Apple’s supply chain and a boon to sales.

Benefiting from LCD driver ICs and memory, institutional investors forecast that ChipMOS profits will be back on track for growth, net income per share is expected to reach NT$3.2 to NT$3.5, and shares will potentially set new highs.

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