Wednesday, November 19, 2008
Taipei, Nov. 18, 2008 (CENS)--PowerChip Semiconductor Corp. (PSC) saw its revenue for October drop over 30% from a month earlier to a five-year low of NT$2.6 billion (US$78 million at US$1:NT$33), losing No.1 title in Taiwan`s DRAM industry.
In the meantime, Nanya Technology Crop. and Inotera Memories Inc. scored revenues of NT$3.24 billion (US$98 million) and NT$3.22 billion (US$97.5 million), respectively. Both are under the Formosa Plastics Group umbrella.
Cutting production to ease oversupply problem led to PSC`s revenue decline. The company is Taiwan`s first DRAM chipmaker to cut output amid escalating oversupply. Its executives pointed out that supply glut had led to price collapse of DRAM spot market and output cut dragged down the company`s deliveries and revenues.
Industry watchers pointed out that since selling prices of the chips are now far below production costs, chipmakers will suffer greater loss on bigger outputs. They estimated PSC to reduce loss soon as a result of cutting output.
Throughout the first 10 months this year, PSC had revenue of NT$49.8 billion (US$1.5 billion), recessing 27.60% year on year. The company posted losses of NT$32 billion (US$969 million) throughout the first three quarters this year.
PSC`s executives pointed out that many of the company`s competitors at home and abroad have considered cutting production since the company took the action. They estimated global DRAM supply to drop significantly in the first quarter of 2009 and the prices to recover in the second quarter next year.
Tight finance in PSC will, somehow, get relieved as Elpida Memory Inc. President & Chief Executive Yukio Sakamoto recently said his company would increase its holding of the two companies` joint venture Rexchip Electronics Corp. to 53% from 48%. Industry watchers estimated the Japanese chipmaker to buy the added ownership for billions of NT dollars from PSC.
Sakamoto said his company and PSC would extend cooperation into the aspect of capital from manufacturing and marketing.
By: DocMemory
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