Tag Archives: Supplier

Apple supplier AMS cuts forecast, indicating poor iPhone demand
November 15, 2018 12:01 pm|Comments (0)

VIENNA (Reuters) – Austria’s AMS (AMS.S), which makes facial recognition technology, became the latest Apple supplier to cut its revenue forecast, adding to growing evidence that the latest iPhones are not selling well.

The logo of the multinational semiconductor manufacturer AMS (Austria Mikro Systeme) is seen during a annual news conference, in Zurich, Switzerland February 6, 2018. REUTERS/Moritz Hager

The Swiss-listed group cut its fourth-quarter revenue outlook by 15 percent and pushed back its medium-term targets, blaming “recent demand changes from a major customer”.

AMS, which specializes in sensors, did not name Apple as the customer, but analysts estimate that the U.S. giant accounts for 40 percent of the Austrian group’s sales.

Apple (AAPL.O) shocked investors two weeks ago with a lower than expected sales forecast for the Christmas quarter, prompting suppliers including U.S. firm Lumentum (LITE.O), British chipmaker IQE (IQE.L) and screen maker Japan Display (6740.T) to issue warnings that pointed to weakness in new iPhone sales.

Like Lumentum, AMS supplies Apple with software components needed for its FaceID technology.

Anglo-German chip designer Dialog Semiconductor (DLGS.DE), which struck a $ 600 million deal with the U.S. tech giant last month bucked the negative trend when it said late on Wednesday it does not see a drop in demand from Apple.

Dialog justified this by pointing out that it supplies many more products than the latest iPhones.

For the past year, investors had largely been willing to overlook stagnating unit sales of the iPhone because average selling prices kept rising. But Apple now faces fierce competition from mid-priced phones from makers such as Xiaomi Corp (1810.HK).

The California-based firm started selling its latest phone generation, the iPhone XS and XS Max in September and the XR model last month.

The new AMS guidance suggested between 11 and 18 million fewer iPhones would be produced in the fourth quarter than an initially estimated 77-82 million, Credit Suisse analysts said in a note to customers.

“This is largely in-line to read from recent Lumentum warning,” they said, adding the Lumentum guidance would have implied an impact of 15-20 million iPhones.

VOLATILE SHARES

AMS shares gained as much as 6.4 percent to 29.65 Swiss francs after a steep drop in early trade.

They have lost nearly 30 percent since Apple’s latest earnings release and are down 70 percent since the beginning of the year and some investors see a buying opportunity, said traders.

AMS expects revenue to come in between $ 480 million and $ 520 million in the three months to Dec. 31, compared with the $ 570-$ 610 million it forecast last month.

The adjusted operating margin for the quarter is expected to reach the low to mid-teen percentage range after previous guidance for the margin to rise to 16-20 percent.

AMS also abandoned its 2019 revenue target of more than $ 2.7 billion, saying it now expects annual double-digit revenue growth for the coming years.

It still aims for a 30 percent adjusted operating margin but no longer gives a specific time frame. It had already postponed the target to 2020 from 2019 in July, at the time due to order delays from a major customer.

“These guys have no visibility any more,” said Mark Taylor, senior sales trader at Mirabaud Securities’ Global Thematic Group.

AMS, which has invested heavily in research and development and in production expansion, is now seeking to address underutilized facilities, increasing competition and its reliance on Apple.

Although a number of analysts have cut their recommendations recently, many target price recommendations are still above 40 Swiss francs. “I wouldn’t be surprised to see (the stock) rally,” said Taylor.

additional reporting by Helen Reid in London; Editing by David Goodman and Keith Weir

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China's ZTE posts 1.1 billion first-half loss on impact from U.S. supplier ban
August 30, 2018 12:00 pm|Comments (0)

HONG KONG (Reuters) – ZTE Corp (000063.SZ) (0763.HK) reported a first-half net loss of 7.8 billion yuan ($ 1.1 billion) on Thursday, weighed down by a ban on U.S. firms selling parts to the Chinese telecom equipment maker that forced it to cease operations for three months.

FILE PHOTO: The company name of ZTE is seen outside the ZTE R&D building in Shenzhen, China April 27, 2016. REUTERS/Bobby Yip/File Photo

The result compared with the 7 billion to 9 billion yuan net loss estimate disclosed last month, and the 2.3 billion yuan profit booked in the same period a year earlier.

Operating revenue in the first half fell 27.0 percent to 39.4 billion yuan.

In June, the network equipment and smartphone maker paid the United States $ 1.4 billion in penalties in a deal to have the supplier ban lifted. The ban, imposed in April in relation to sanction violations, crippled ZTE and became a source of friction in Sino-U.S. trade talks.

($ 1 = 6.8300 Chinese yuan renminbi)

Reporting by Sijia Jiang and Twinnie Siu; Editing by Christopher Cushing and Edmund Blair

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Apple sensor supplier AMS warns of second-quarter slowdown
April 23, 2018 6:02 pm|Comments (0)

ZURICH (Reuters) – Chipmaker AMS reported first-quarter sales toward the lower end of its guidance range on Monday and warned of a downturn owing to weaker orders from one of its main customers.

FILE PHOTO: The logo of the multinational semiconductor manufacturer AMS (Austria Mikro Systeme) is seen during a annual news conference, in Zurich, Switzerland February 6, 2018. REUTERS/Moritz Hager

AMS did not name the customer, but the Austrian company is a big supplier to Apple, making components for the U.S. technology giant’s iPhone.

“We are not able to discuss the specific customer, but we are seeing significantly lower business from a large smartphones program and that is having a strong impact on the consumer business and the company as a whole,” said AMS head of investor relations Moritz Gmeiner.

For its second quarter, AMS said it expected sales to drop to between $ 220 million and $ 250 million, down from the $ 452.7 million in sales it reported for the first three months of 2018.

The downturn was based on weaker orders and lower forecast orders in the months ahead, Gmeiner said.

AMS added that changes in upcoming products, which prevented the pre-production of parts, mean that it also expects reduced utilization of factory capacity, which will hit profit margins.

The company, which also makes sensors used in cars and industrial gear, said the problem would be temporary and that preparations for ramping up production in the second half of the year remain on track.

FILE PHOTO: An iPhone X is seen on a large video screen in the Apple visitor centre in Cupertino, California, U.S., November 17, 2017. REUTERS/Elijah Nouvelage/File Photo

The Swiss-quoted company also confirmed its mid-term growth and profitability guidance, aiming for a 60 percent compound annual growth rate between 2016 and 2019, combined with an adjusted EBIT margin target of 30 percent from 2019 onwards.

First-quarter net profit rose to $ 99.9 million from a loss of $ 19.9 million a year earlier.

AMS shares have gained 8.1 percent this year, outpacing a Stoxx 600 Technology Index that has gained 0.7 percent.

The company’s stock has struggled of late, however, amid fears that Apple increasingly plans to use its own chips rather than buy them from third parties.

Weak results from Taiwan Semiconductor (TSMC) this month also spread concern about softer demand for smartphones.

Analysts have said that AMS obtains about 35 percent of its revenue from Apple, with mobile phone components making up the vast majority of its business with the U.S. company.

AMS supplies optical sensors that play a key role in facial recognition – one of the most distinctive features of Apple’s flagship iPhone X, which was introduced late last year and appears to have helped to drive AMS’s recent results.

Reporting by John Revill; Editing by David Goodman

Our Standards:The Thomson Reuters Trust Principles.

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Fuyao Glass – A Compounding Auto Supplier
October 21, 2017 12:00 pm|Comments (0)

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