Siliconware Precision Industries (SPIL) projects its third-quarter revenues will grow 2-6% sequentially with both the consumer electronics and wireless communications sectors playing as major growth drivers, company chairman Bough Lin said during a July 27 investors conference. Anticipated business growth at US-based clients is the other contributing factor, Lin added.
Lin pointed out that second-quarter inventories at major clients in the US were only 1-2% higher than the prior quarter's levels, a more optimistic scenario than previously thought. Judging from the customers' positive outlook, SPIL's monthly sales are likely to rebound to the previous high of NT$5.5 billion (US$191 million) during the second half of 2011, Lin noted.
Inventory correction in the chip industry supply chain may persist through the third quarter, but the impact on demand for packaging and testing will be relatively insignificant, Lin believes.
Meanwhile, SPIL's gross margin in the third quarter is expected to outperform the 15.6% posted in the second quarter, thanks to rising sales of the company's copper wire bonding services, Lin indicated.
SPIL revealed that sales generated from copper wire bonding totaled NT$4.97 billion as of the end of June 2011, up significantly from the NT$1.13 billion reached as of the end of June 2010. The copper segment now accounts for 27.4% of SPIL's total wire bonding revenues.
Sales of SPIL's copper wire bonding services will continue to grow in the third quarter, Lin said. The utilization rate of its copper wire bonding capacity is estimated at 95% in the quarter, up 5pp sequentially, Lin added.
SPIL reported NT$14.74 billion in consolidated revenues for the second quarter, up 1.9% sequentially. The result came below the company's previous guidance of a 3-7% increase. Lin attributed this shortfall to mainly decreasing demand for handset chips and memory ICs, and overbooking by clients previously amid upstream shortage concerns.
In addition, Lin remarked that the overall semiconductor industry will see a flat or slight increase sequentially in the second half of 2011, and the growth forecast for the entire year is maintained at 4-6%.
SPIL's planned capex budget for 2011 of NT$10 billion remains unchanged, according to Lin.