With smartphone demand booming particularly in China, driver IC design house Himax Technologies expects its fourth-quarter revenues to register flat to slight growth sequentially with gross margin up more than 1.5pp.
Recent brisk sales of smartphones in China reportedly have triggered demand for small- to medium-size display driver ICs. As one of the beneficiaries, Himax has secured orders from China's branded companies.
Himax indicated that strong demand for small- to medium-size display driver ICs should be able to offset weakness in the large-size segment. Himax supplies driver ICs for small- and medium-size panels used in mobile phones and consumer electronics products including tablet PCs, mobile gaming and car navigation devices.
Himax revealed that sales of its driver ICs for small- to medium-size applications hit a record high of US$79.7 million in the third quarter. The number also showed growth of 28.1% on quarter and 47.2% on year.
As for driver ICs used in large-size applications, Himax expects demand to remain sluggish in the fourth quarter. However, short lead-time orders might emerge as customers are holding low inventory, Himax noted.
Himax' products for large-size panels target desktop monitors, notebooks and TVs. Revenues from the segment declined 18.9% sequentially and 14.4% from a year earlier to US$62 million in the third quarter, accounting for 38.3% of Himax overall sales for the quarter.
"Our third-quarter 2011 performance highlights strong growth of display drivers for small- and medium-size applications," said Jordan Wu, president and CEO of Himax, in a statement. "The handset segment has become our single largest revenue contributor, replacing what were traditionally contributions from TV display drivers."
"As for non-driver products, our touch panel controller is expected to be the next bright spot," Wu continued. "In the third quarter we successfully mass-produced and shipped our multi-touch capacitive touch controllers to a worldwide smartphone brand leader."
Himax brought in US$162.1 million in third-quarter revenues, representing a 17.2% rise from the prior quarter's level.
In addition, Himax noted that the company's efforts to improve its product mix and cost structure will boost its gross margin to 20% or more in the fourth quarter. Himax' gross margin stood at 18.5% in the third quarter.
Source:digitimes