Powerchip Technology, which has the largest 12-inch DRAM capacity in Taiwan, is confident about its business momentum in 2010. The memory chipmaker expects its net profits for the year to top the NT$27.33 billion it recorded in 2006, according to company chairman Frank Huang.
Huang made the remark after Powerchip reported net income for the second quarter almost doubled from NT$3.5 billion in the prior quarter.
Powerchip posted net profits of NT$6.77 billion in the second quarter of 2010, showing a return to profitability from losses of NT$11.73 billion a year ago. Profits for the first two quarters of this year totaled NT$10.27 billion, compared to losses of about NT$18 billion posted during the same period of 2009.
Huang said that due to delivery delays of immersion scanners, Powerchip's 12-inch fabs may not start to deploy 45nm process technology until the first quarter of 2011. The company is ramping up its 63nm output with less expenditure on equipment upgrades, prior to a direct shift to the 40nm-class node, Huang added.
Costs for 50nm process products are only 15% less compared with typical 65nm-node products, but the latter is less economical due to the need for capex, Huang indicated.
However, some market observers have expressed concerns that Powerchip may fail to sustain its profit growth, as its production schedule for sub-50nm chips falls behind rivals Nanya Technology and Inotera Memories. Both Nanya and Inotera are expected to see 50nm become their major production node by the end of this year.
Pointed out in its recent research report that Powerchip has a lot of available wafer capacity and, if matched with the right technology, can be a serious competitor in the global DRAM market. Powerchip move up to the fifth position in iSuppli's rankings of top DRAM makers.
Powerchip has revealed a capex goal of NT$12.6 billion for 2010, with 67% of the spending to be used for its transition to a 63nm process and the remainder for immersion equipment purchases.