Memory module makers Adata Technology and Power Quotient International (PQI) both swung to net losses in the first half of 2011 from profits a year ago.
Adata said the company had been clearing out inventory to mitigate losses arising from chip price declines. As of the end of the second quarter, it had NT$3.9 billion (US$134.4 million) worth of chip inventory compared to over NT$4 billion at the end of the first quarter.
But with spot prices for DDR3 chips rebounding recently, Adata expects DRAM pricing to have little room for further declines. As for NAND flash, demand for smartphones and tablet PCs is expected to sustain chip prices in the second half of 2011, the company added.
Adata swung to net losses of NT$110 million in the second quarter from profits of NT$95.8 million in the first quarter. It registered net losses of NT$14.7 million in the first half of 2011. EPS for the first half reached negative NT$0.07, compared to a positive EPS of NT$0.17 in the same period of 2010.
Also affected by weakening pricing for memory chips, PQI fell back to the red in the second quarter with net losses of NT$99 million. The company reported NT$94 million in net losses for the first half of 2011, compared with NT$116 million in profits a year ago.