GlobalWafers Co, the world’s third-largest silicon wafer supplier, announced yesterday that it expects its revenue to drop by a high single-digit percentage this year. This is due to a prolonged inventory correction cycle among its customers.
Previously, the Hsinchu-based company had predicted flat revenue growth for 2024. “I think this year’s revenue will be lower than last year’s,” said GlobalWafers chairwoman Doris Hsu during a virtual investors’ conference. Last year, the company achieved record-high revenue.
Hsu explained that customers are reducing their inventories at a “much slower-than-expected” pace, leading to a delayed recovery in raw wafer revenue. GlobalWafers anticipates that customers will significantly lower their inventory levels by the end of this year, paving the way for a recovery in 2025. “Next year will be a healthy and positive year with good growth, not only for chip, memory, and foundry companies but also for silicon wafer companies,” Hsu added.
Despite the revenue decline, GlobalWafers plans to continue expanding its capacity at its new 12-inch fabrication plants in the US, Italy, and other locations. Additionally, the company recently announced plans to purchase land and buildings in Malaysia for 146 million ringgit (US$32.63 million) to meet customer demand amid ongoing geopolitical tensions.
GlobalWafers reported a 16.7 percent annual decrease in revenue, totaling NT$30.41 billion (US$930.31 million) in the first half of this year. The company expects revenue in the second half to remain flat compared to the first half. While demand for 12-inch wafers remains strong and 8-inch wafer demand is recovering, there are no signs of further decline for 6-inch wafers.
In the last quarter, GlobalWafers’ net profit dropped by 18.5 percent to NT$2.88 billion, down from NT$3.53 billion in the previous quarter and a 39.9 percent decrease from NT$4.79 billion a year earlier. This was the lowest profit reported in the past eight quarters. Earnings per share fell to NT$6.02 last quarter, compared to NT$8.1 in the previous quarter and NT$11 a year ago. The gross margin decreased to 32.3 percent, the weakest since the fourth quarter of 2017, due to production disruptions caused by a cyberattack in June.
