Advanced Semiconductor Engineering (ASE) has estimated that its core IC assembly test and material (ATM) business will post another sequential decrease of 6-9% in shipments in the first quarter of 2012, with flat ASPs. ASE expects shipments to return to the previous high levels in the second quarter.
Along with lower shipments, first-quarter gross margin in 2012 is likely to shrink 2.5-3pp on quarter, ASE indicated. But gross margin for the second quarter is set to improve after hitting bottom in the first quarter, ASE said.
ASE announced revenues from its IC ATM operation were NT$31.91 billion (US$1.08 billion) in the fourth quarter of 2011, showing slight decreases from NT$32.58 billion in the third quarter and NT$32.6 billion a year ago.
ASE said that sales of its IC ATM unit will rebound starting March and grow through the second quarter.
ASE's consolidated revenues, which include sales generated by EMS subsidiary Universal Scientific Industrial (USI), slid 1% on quarter and 13% on year to NT$46.39 billion in the fourth quarter of 2011. Net profits declined 24% sequentially and 46% from a year earlier to NT$2.64 billion during the period. EPS came to NT$0.40.
For all of 2011, ASE reported NT$13.73 billion in net profits on consolidated revenues of NT$185.35 billion. Revenues at its IC ATM business grew 9.1% to NT$4.35 billion in 2011, outperforming the industry average, ASE said. The firm claimed a 18.1% share of the global semiconductor assembly and testing services market in 2011, up from 16.9% in 2010.
ASE remains focused on the development of its copper wire bonding and advanced packaging technology, according to company COO Tien Wu. In the meantime, ASE continues to vie for orders from IDM firms for low pin-count and discrete devices, said Wu.
ASE saw sales from copper bonding total US$785 million in 2011, up significantly from US$307 million in 2010, Wu revealed. Of the 2011 sales, orders from fabless IC firms contributed as high as US$720 million. ASE is eyeing potential growth opportunities in the IDM sector, Wu noted.
In addition, sales generated from its low pin-count and discrete IC packaging increased 39% to US$361 million in 2011, thanks to increased outsourcing demand by IDM companies, Wu disclosed.
ASE has budgeted a capex of between US$700 million and US$750 million for 2012, with plans to further expand its flip-chip packaging and bumping capacity, according to company CFO Joseph Tung.