A couple of days ago in Record Sales for IC Design Houses we observed some of the design companies were optimistic about sales in August and some of the design houses were expecting record sales for the month. However yesterday in Analyst Cuts TSMC Forecast we noted a decline in TSMC forecast implied a decline in the greater market.
To follow-up, Digitimes yesterday reported some IC design houses focused on PCs have become more conservative in their predictions for Q3. Digitimes writes:
PC related IC design houses Realtek Semiconductor, Anpec Electronics and Integrated Technology Express (ITE) have all reduced their sales growth targets for the third quarter because demand from motherboards in August has not been as strong as expected. Market watchers expect Richtek Technology will also reduce its third-quarter sales target.
The IC design companies indicated that shipments to Asustek Computer, Gigabyte Technology and Micro-Star International (MSI) declined week by week in August. The Taiwan-based motherboard makers are also pessimistic about the outlook for September, prompting the IC design companies to adjust their sales growth targets for the third quarter.
In IC Design Houses' Growth Constrained we also observed negative trends in the TFT LCD ID driver market. These drivers are typically used in consumer electronics devices and a slowing economy has continued to have a negative impact on the demand for these devices. However, Digitimes observes that some TFT LCD manufacturers are investing in the upstream driver companies to ensure they have sufficient supplies. Digitimes writes:
As the number of LCD driver IC providers continues to decline due to low profitability, TFT-LCD makers are finding it increasingly important to forge close ties with the remaining industry players in order to maintain stable upstream supplies of LCD driver ICs.
Except for Novatek Microelectronics which entered the market the earliest, most of the remaining LCD driver IC design companies including Himax Technologies, Orise Technology, Sitronix Technology and Raydium Semiconductor have panel makers among their major shareholders.
Surprisingly, at the time of writing, most of the companies listed above had seen slight increases in the share prices. Only ITE saw a significant drop.
- ITE (3014.TW) shares had dropped 3.25%
- RealTek (2379.TW) shares were up 0.62%
- Anpec (6138.TWO) shares were up by 0.10%.
- Novatek (3034.TW) shares were up by 2.97%
- Orise shares (3545.TW) remained unchanged
- Sitronix (8016.TW) shares were up 1.84%
- Raydium (3592.TWO) shares were up by 0.41%
Interestingly, I also saw RealTek (2379.TW) has been given a target price of NTD99 by both Citigroup (in July) and KGI Analyst Noreen Niu earlier in June. Right nowRealTek (2379.TW) is trading at NTD65.50. A share price of NTD99 means the price has to rise 50%. Now should I buy?
Digitimes: PC related IC design houses turn conservative over 3Q outlook on falling demand from motherboards
Digitimes: LCD panel makers invest in LCD drive IC suppliers to stabilize market position
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