Prospects bright for Advantech on strong demand
By Meryl Kao / Staff Reporter
Industrial PC maker Advantech Co (研華) yesterday said it is targeting double-digit revenue growth next year, driven by robust growth in semiconductor and medical equipment, factory automation and artificial intelligence (AI) infrastructure.
The company’s semiconductor-related business, including industrial controllers and industrial servers, is expected to remain a key growth driver this quarter and next year, supported by strong demand for semiconductor equipment and AI data centers, Advantech embedded Internet of Things president Miller Chang (張家豪) said at an earnings conference.
Semiconductor-related business accounted for about 15 percent of Advantech’s total revenue in the first three quarters of this year, while edge AI-related products accounted for 24.5 percent of total revenue during the same period, with the share expected to reach 30 percent by the end of the year, Chang said.
Advantech Co’s signage is pictured in New Taipei City’s Linkou District in an undated photograph.
Photo: Fang Wei-chieh, Taipei Times
The company has increased investment in physical AI, edge AI, AI factories and robotics, and expects to have more than 150 robotics-related projects in its pipeline for the full year, he said.
Advantech’s revenue rose 83 percent year-on-year to NT$32.44 billion (US$988.39 million) in the third quarter and 49 percent to NT$78.95 billion in the first nine months of this year. The company expects revenue this quarter to range between US$970 million and US$990 million, Advantech president Eric Chen (陳清熙) said.
North America accounted for 33 percent of the company’s revenue in the first nine months, followed by China with 22 percent and Europe with 15 percent, he said.
The company secured about 161 design contracts in North America in the first three quarters, which are expected to generate US$687 million in revenue and support growth momentum, he added.
Advantech’s net profit last quarter rose 37.7 percent quarter-on-quarter and 125 percent year-on-year to NT$6.21 billion.
Earnings per share rose to NT$7.15 from NT$5.2 the previous quarter and NT$3.2 a year earlier, reaching a record high for a single quarter.
Gross margin fell to 36.7 percent last quarter from 37.7 percent in the previous quarter due to rising component costs, including for solid-state drives, memory chips and central processing units, Chen said.
Such components used to account for about 30 percent of product costs, but the proportion has risen to about 80 percent, he said.
Advantech expects gross margin to range between 36 percent and 38 percent this quarter, supported by product price increases, Chen said.
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