Adata Technology operated in the red for the second consecutive quarter, but its net losses narrowed to NT$9.42 million (US$0.31 million) in the third quarter of 2010 from NT$419 million in the second. Fellow memory module company Transcend still brought in profits in the third quarter, but saw net income for the quarter decline 31.2% sequentially to NT$275 million.
Adata announced net sales of NT$ 10.47 billion for the third quarter, down 0.26% on quarter but up 9% on year. Of its third-quarter sales, 60.64% came from DRAM modules and NAND flash products made up the remainder.
DRAM prices continue to be under pressure, but demand in the NOR flash market is warming up, Adata indicated. The company revealed that the value of its inventory slid to NT$2.52 billion as of the end of the third quarter from the NT$4.7 billion at the end of the second quarter. The inventory turnover levels at Adata reached about three weeks in the third quarter, and will be maintained within one month in the fourth, the company added.
Adata's net losses for the third quarter translated into a negative EPS of NT$0.04. Affected by the strengthening NT dollar, the company incurred NT$18.41 million in losses from currency exchange rates in the third quarter.
Transcend has reported revenues of NT$8.17 billion for the third quarter, up 22.47% sequentially. However, gross margin for the quarter fell to 4.49% from over 10% in the prior quarter, due to inventory losses arising from chip price drops. The company recognized an inventory loss of NT$121 million in the third quarter.
Transcend's net income for the third quarter came to NT$0.64 a share, the lowest over the past 10 quarters.
Transcend said it adopts natural hedging to mitigate the impact of NT dollar appreciation. In the third quarter, the company recorded foreign-exchange gains of NT$13 million.