IC backend testing and assembly firm King Yuan Electronics Company (KYEC) expects more than 30% of its revenues to come from international IDM clients in 2011, up from 25% in 2010, according to company president and CEO Mike Liang.
KYEC is aiming for non-Taiwan customers to account for more than half of its sales in 2011, said Liang, adding that Europe-based clients may contribute more than 10% of its sales next year, up from a single-digit percentage in 2010. KYEC is also working with Japan-based IDMs with orders bringing in a solid contributions to its revenues in 2011, Liang indicated.
KYEC used to depend on MediaTek and other Taiwan-based IC designers for revenue growth. Orders placed by MediaTek now account for 12-15% of KYEC's total revenues compared to the 20-30% usually seen in the past.
In terms of market segments, Liang said revenues will be driven primarily by growth in orders for handset solutions and ICs for automotive electronics applications. However, sales generated from the memory sector are likely to remain flat, Liang added.
In addition, Liang pointed out that KYEC's in-house testers will generate 20% of the company's total revenues in 2011 from about 12% in 2010. With less expenditure on buying equipment, production costs will be reduced to counter the competitive pricing pressure, Liang said.
Liang also estimated that KYEC's revenues will be dragged down by seasonality in the fourth quarter. However, the company's performance may be stronger than historical seasonal patterns in the first quarter of 2011, according to Liang.
Market watchers expect KYEC's consolidated revenues will top NT$20 billion (US$683 million) in 2011, up from the NT$15-15.5 billion predicted for 2010.