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Chipmaker AT&S sees profitability growth on strong demand from smartphone makers, Telecom News, ET Telecom


Chipmaker AT&S sees profitability growth on strong demand from smartphone makersVIENNA: Austrian chipmaker AT&S on Tuesday reported a 13.2% increase in its first-quarter core profit and forecast its profitability would increase in the second quarter thanks to strong demand from smartphone makers and industrial customers.

“Despite the downward revisions of economic forecasts, the global megatrends in the electronics industry are still intact overall – especially due to progressing digitalisation, the new 5G mobile communication standard and massive data volume growth,” the company said.

AT&S, which produces circuit boards for smartphones and tablets and supplies firms such as Apple, Intel and major European auto suppliers, said it does not expect the auto industry to quickly recover to pre-crisis levels.

It expects slight growth in medical applications in the full year but predicts delayed product launches in its mobile devices unit due to uncertain consumer behaviour.

AT&S, which plans to invest up to 120 million euros in technology upgrades over four years, posted a net loss of 7.5 million euros in the April-June period after a loss of 6.2 million in last year’s quarter.

Earnings before interest, tax, depreciation and amortisation (EBITDA) reached 39.5 million euros ($46.5 million) on revenues of 247.9 million euros.

AT&S expects its EBITDA margin to grow to 20% to 25% in the second quarter from 15.9% in the first quarter. Sales are forecast to be flat compared to last year’s period.





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