With no off-season for silicon wafers, SUMCO’s profits have surged and remain strong this quarter; its stock price has soared to a two-year high.

On the 11th, SUMCO, Japan’s leading silicon wafer manufacturer, announced its financial results for the previous quarter (January-March 2017) after the close of the Tokyo stock market: Consolidated revenue surged 16.3% year-on-year to 6.195 billion yen; consolidated operating profit soared by 123.3% to 8.067 billion yen; and consolidated net profit also jumped by 129.3% to 3.613 billion yen. SUMCO noted that, unlike in previous years, the last quarter did not show the usual seasonal adjustment—demand remained strong even during what would normally be a slow season. Demand for 12-inch and 8-inch silicon wafers continued to be robust, outpacing production capacity, and inventories of both 12-inch and 8-inch silicon wafers continued to decline. Looking ahead to this quarter (April-June 2017),

On the 11th, after the close of trading on the Japanese stock market, SUMCO, Japan’s leading silicon wafer manufacturer, announced its financial results for the previous quarter (January-March 2017): Consolidated revenue surged 16.3% year-on-year to 6.195 billion yen; consolidated operating profit soared by 123.3% to 8.067 billion yen; and consolidated net profit also jumped by 129.3% to 3.613 billion yen.

SUMCO stated that, unlike in previous years, last quarter did not see the typical seasonal adjustment—rather, the off-season was anything but slow. Demand for 12-inch and 8-inch silicon wafers remained robust, with production unable to keep pace with orders, and inventories of both 12-inch and 8-inch silicon wafers continued to decline.

Looking ahead to this quarter (April–June 2017), SUMCO forecasts that consolidated revenue will increase significantly by 24% year-on-year to 64 billion yen, consolidated operating profit will surge by 260% to 9 billion yen, and consolidated net profit will jump by 588% to 5.5 billion yen.

SUMCO stated that the prices of 12-inch silicon wafers are expected to rebound starting in Q2 (April–June), and 8-inch wafer prices will also begin to recover. Furthermore, in response to requests from major customers, SUMCO will start negotiating contracts for next year, indicating that customers are increasingly concerned about their ability to secure a stable supply of silicon wafers.

According to quotes from the Jingshi XQ Global Winners System, as of 9:55 a.m. Taipei time on the 12th, SUMCO surged by 2.22% to 1,978 yen. Earlier, it had climbed as high as 2,043 yen, reaching a new high in about two years (since April 17, 2015).

SUMCO is the largest shareholder of Taisung Technology (3532), holding a 48.85% stake in Taisung Technology through its subsidiary, SUMCOTECHXIV Co., Ltd.

According to a MoneyDJ News report on April 24, Japan’s major silicon wafer manufacturers, Shin-Etsu Semiconductor and SUMCO, will raise contract prices for the third quarter starting in July, with an increase of 10%. This price hike for silicon wafers is lower than the 30% reportedly circulating in the market. Moreover, SUMCO has agreed with TSMC (2330) on a four-year supply contract, stipulating that the price increase will not exceed 40%. These developments indicate that Japan’s two leading semiconductor silicon wafer manufacturers are adopting a moderate pricing strategy and ensuring long-term supply stability, which will benefit TSMC.

It is understood that 12-inch silicon wafers have seen price increases for two consecutive quarters, in January and April of this year, with cumulative price hikes exceeding 20%. Moreover, contract prices for the third quarter, starting from July, are expected to rise by another approximately 10%.

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