Hon Hai Precision Industry Co (鴻海精密), a major assembler of Apple Inc’s iPhones, reported that net profit declined for the second year in a row to its lowest level in about five years.
The company’s net profit last year shrank 6.97 percent annually from NT$138.73 billion (US$4.5 billion) to NT$129.07 billion, a Hon Hai financial statement released on Friday last week showed.
Earnings per share rose to NT$8.03, from NT$8.01 a year earlier, as a result of a 20 percent reduction in Hon Hai’s capital shares.
The financial statement also showed that net profit fell 12.62 percent to NT$62.62 billion in the fourth quarter of last year, from NT$71.66 billion a year earlier, mainly due to a slide in non-operating income, which plunged 82.85 percent annually from NT$63.22 billion to NT$10.85 billion.
However, gross margin in the October-to-December quarter rose to 7 percent, from 6.1 percent a year earlier, while revenue also climbed 4.59 percent to a record high of NT$1.81 trillion, compared with NT$1.73 trillion a year earlier, the statement showed.
Last year, overall revenue grew 12.47 percent to NT$5.29 trillion, from NT$4.71 trillion in 2017, with gross margin declining 0.17 percentage points to 6.44 percent and operating margin rising 0.18 percentage points to 2.57 percent.
This year, Hon Hai shopuld secure the largest share of Apple’s orders at more than 60 percent, analysts said.
Hon Hai, which is scheduled to have an annual shareholders’ meeting on June 21, has not announced its cash dividend distribution plan.
Last year, it issued a cash dividend of NT$2 per common share and returned NT$2 per share to shareholders after the capital reduction.
Separately, Foxconn Industrial Internet Co Ltd (FII, 富士康工業互連), an 85 percent-held subsidiary of Hon Hai, released its first annual income statement on Friday since launching its initial public offering on the Shanghai Stock Exchange in June last year.
The company, which manufactures casings, network equipment and servers, reported annual revenue of 415.38 billion yuan (US$61.89 billion), an increase of 17.16 percent from 354.54 billion yuan a year earlier, on the back of rising sales of communication and networking equipment.
Net income reached 16.9 billion yuan, 6.52 percent higher than 15.87 billion yuan a year earlier, with earnings per share of 0.9 yuan, compared with 0.95 yuan in 2017.
Shares of Hon Hai ended 2.37 percent higher at NT$73.5 in Taipei trading on Friday.
FII, which debuted on June 8 at 13.77 yuan per share, rose 3.15 percent to close at 14.75 yuan in Shanghai on Friday.
ARTIFICIAL INTELLIGENCE: The chipmaker last month raised its capital spending by 28 percent for this year to NT$32 billion from a previous estimate of NT$25 billion Contract chipmaker Powerchip Semiconductor Manufacturing Corp (力積電子) yesterday launched a new 12-inch fab, tapping into advanced chip-on-wafer-on-substrate (CoWoS) packaging technology to support rising demand for artificial intelligence (AI) devices. Powerchip is to offer interposers, one of three parts in CoWoS packaging technology, with shipments scheduled for the second half of this year, Powerchip chairman Frank Huang (黃崇仁) told reporters on the sidelines of a fab inauguration ceremony in the Tongluo Science Park (銅鑼科學園區) in Miaoli County yesterday. “We are working with customers to supply CoWoS-related business, utilizing part of this new fab’s capacity,” Huang said, adding that Powerchip intended to bridge
Microsoft Corp yesterday said that it would create Thailand’s first data center region to boost cloud and artificial intelligence (AI) infrastructure, promising AI training to more than 100,000 people to develop tech. Bangkok is a key economic player in Southeast Asia, but it has lagged behind Indonesia and Singapore when it comes to the tech industry. Thailand has an “incredible opportunity to build a digital-first, AI-powered future,” Microsoft chairman and chief executive officer Satya Nadella said at an event in Bangkok. Data center regions are physical locations that store computing infrastructure, allowing secure and reliable access to cloud platforms. The global embrace of AI
RIDING AI WAVE: : Most of its NT$15bn capital budget would be spent on packaging technologies used in AI and HPC chips and advanced testing technology, it said Chip testing and packaging service provider Powertech Technology Inc (PTI, 力成科技) plans to increase this year’s capital expenditure by 50 percent to expand capacity to meet growing demand for advanced memorychips used in artificial intelligence (AI) products. The company proposed to spend NT$15 billion (US$460.94 million) to expand advanced capacity and equipment, compared with a budget of NT$10 billion it planned three months ago. “We are seeing a recovery in market demand as well as new business opportunities. We will spend heavily on advanced packaging” equipment, Powertech chief executive officer Boris Hsieh (謝永達) told investors on Tuesday. “We will focus on ramping
INFLATION WATCH: A rate hike in March would help keep inflation at 2.16 percent this year, although a weak currency and higher electricity rates are an issue, S&P said Moody’s Ratings and S&P Global Ratings have reaffirmed Taiwan’s sovereign credit ratings at “As3” and “AA+” respectively with a stable outlook on the back of high income and wealth levels, a strong institutional framework and robust external positions. The affirmations came as Taiwan’s economy is gaining momentum after quarters of slowdown induced by stubborn global inflation and monetary tightening. Taiwan’s strong fiscal and external buffers have improved relative to peers as evidenced by recent shocks linked to the COVID-19 pandemic and the ongoing US-China technology dispute, the two ratings firms said. “Taiwan stands as the epicenter of the global semiconductor supply chain, accounting