Powertech Technology (PTI) holds a conservative view towards its business in the first quarter of 2012, due to the ongoing European debt crisis that continues to weigh on demand, and the impact from Thailand's recent floods on the supply side, according to company chairman DK Tsai.

Tsai guided PTI's consolidated revenues for the upcoming first quarter of 2012 would see a 10-15% sequential decrease.

Unfavorable macroeconomic conditions have led to clients' more conservative order-placing attitude, Tsai indicated. Meanwhile, the recent Thai flooding has caused a shortage of hard drives, which is impacting the PC industry supply chain, Tsai said.

The popularity of Apple's products is also squeezing demand for conventional notebooks, Tsai noted. The combination of negative factors is hitting the DRAM industry, as well as PTI, whose main business focus is to provide packaging and testing services for the memory sector.

Chipmakers have been scaling back their output with an aim to stop prices falling and help the industry return to a healthier supply-demand dynamic, Tsai noted. Their ongoing efforts to cut back production are bringing negative effects on sales as well as those at their supply-chain partners, but the industry is headed in the right direction from a long-term perspective, Tsai pointed out.

As long as suppliers do not need to control their output, and tight supplies of HDD ease, the industry will start heating up in the second quarter of 2012 boosting prices for DRAM memory, Tsai indicated.

Source:digitimes