Firm chairman Pierre Chen said that while industry-wide lead times stand at eight to 10 months, Yageo gets components to its customers in three.
Yageo Corp (國巨), the world’s No. 3 multilayer ceramic capacitor (MLCC) supplier, yesterday said that revenue would continue to grow sequentially this quarter, driven by resilient customer demand for premium passive components used in notebook computers, data centers and 5G-related devices.
The growth momentum is reflected in the firm’s strong book-to-bill ratio of 1.5, company chairman Pierre Chen (陳泰銘) told an online investors’ conference yesterday.
Lead times for high-end passive components stand at eight to 10 months, while Yageo only needs three months to ship standard passive components to its customers, Chen said.Yageo’s inventory has maintained at a low level of 60 days, he added.
“We have heard some noise about inventory in the standard product market. We are not concerned about demand in the premium market. Momentum in the premium market continues to build. We can continue to expect growth in the third quarter,” Chen said.
As it continues to expand in high-end markets, Yageo is confident that over the next two to three years, it can outpace the industry’s annual growth rate of 3 to 10 percent, Chen said.
In three years, premium products are expected to contribute 80 percent of total revenue, up from 75 percent, while standard products are likely to contribute 20 percent, down from 25 percent, Chen said.
The shift would help Yageo maintain a gross margin of more than 40 percent in the long term, as premium products tend to have a gross margin of more than 35 percent, he said.
In the long term, passive components used in vehicles are expected to be major drivers of growth, so the company plans to allocate 40 to 50 percent of the capacity at its new fab in Kaohsiung to that, Chen said, adding that the fab is under construction and would start production next year.
Yageo reported second-quarter net profit of NT$6.33 billion (US$225.49 million), an 11-quarter high and an increase of 92 percent annually, up from NT$3.3 billion, and 26 percent quarterly, up from NT$5.02 billion.
Earnings per share increased to NT$12.81, up from NT$7.01 a year earlier and NT$10.17 in the first quarter. Gross margin fell to 41 percent from 44.3 percent last year, but improved from 39.1 percent in the first quarter.
Yageo expects this quarter’s gross margin to resemble last quarter’s.
Revenue last quarter doubled to NT$27.71 billion from NT$13.47 billion last year, mostly due to the acquisition of US-based Kemet Corp. On a quarterly basis, revenue increased 16.7 percent, up from NT$23.75 billion.
MLCCs contributed the most revenue last quarter at 29 percent, followed by tantalum at 21 percent and chip resistors at 19 percent.
