AUO Revenue Hit By Weak Demand

Flatpanel maker AU Optronics Corp posted revenue of NT$70.05 billion (US$2.27 billion) for last quarter, a 13.6 percent decrease from NT$81.04 billion in the same period last year as shipments fell on slumping demand.

Shipments of panels used in PCs and TVs fell 3.7 percent year-on-year to 28.67 million units, while those of small and medium-sized panels for smartphones tumbled 16.4 percent to 35.6 million units, AUO said in a statement.

On a quarterly basis, PC and TV panel shipments grew 5.5 percent, surpassing AUO’s expectation of no growth three months ago, while shipments of small and medium-sized panels increased 7.8 percent, slightly higher than its projection of 5 percent growth.

In the first nine months, revenue dipped 10.29 percent year-on-year to NT$206.82 billion from NT$230.54 billion, AUO said.

AUO chairman Paul Peng in July warned about industry headwinds due to severe oversupply and sagging sales of TVs, PCs, smartphones and vehicles amid lingering trade tensions, while clients’ inventory buildup demand ahead of the end-of-year holiday season was not strong.

TrendForce Corp, a Taipei-based market researcher, said in a report on Monday that major flat panel makers worldwide have slashed their factory utilization rates this quarter to cope with widening losses on TV panels.

AUO last month lowered the equipment loading rate at its G8.5 fab to 50 percent and might retain it at that level this quarter due to falling demand for 55-inch TV panels, TrendForce said.

The company also cut the utilization rate at one of its G6 fabs by 20 percent to reduce the production of 65-inch TV panels, the report said.

South Korea’s Samsung Electronics Co and LG Display Co have also cut equipment loading rates by 30 to 50 percent at some of their G7 and G8.5 fabs as demand for TV panels plunges, the report said.

Taiwan’s Innolux Corp was the exception, as the company did not substantially reduce its production, the report added. Taipei Times