Semiconductor Materials Supplier Soitec Reports Q1 Sales Slump
3 Sources
3 Sources
[1]
Semiconductor materials supplier Soitec reports Q1 sales slump
Soitec has been banking on a rebound of the smartphone market to lift sales of its RF-SOI (radio frequency silicon-on-insular) technology used in smartphones and other wireless devices. "The absorption of our customers' RF-SOI inventories is progressing and should be completed towards the end of the first half of our fiscal year 2025," Soitec chief executive Pierre Barnabe said in a statement. The group has been facing inventory adjustments and a sluggish smartphone market over the past year, which it had warned would continue weighing on the first half of the year, with the biggest hit to sales expected in the first quarter. One of Soitec's largest clients TSMC last week raised its full-year revenue forecast citing surging demand for chips used in artificial intelligence and strong smartphone demand. First quarter sales came at 121 million euros ($131.30 million), just above analysts' forecast of 118 million euros. Soitec, which has a market cap of 4.09 billion euros, kept its full-year guidance for revenue matching 978 million euros it reported last year and a core profit (EBITDA) margin of around 35%. (Reporting by Dagmarah Mackos; Editing by Tomasz Janowski)
[2]
Semiconductor materials supplier Soitec reports Q1 sales slump
(Reuters) - French semiconductor materials supplier Soitec on Tuesday reported a 24% drop in its comparable first quarter revenue, slightly ahead of analyst expectations, as inventory correction in the smartphones market and a slower automotive market continued to weigh. WHY IT IS IMPORTANT Soitec has been banking on a rebound of the smartphone market to lift sales of its RF-SOI (radio frequency silicon-on-insular) technology used in smartphones and other wireless devices. KEY QUOTES "The absorption of our customers' RF-SOI inventories is progressing and should be completed towards the end of the first half of our fiscal year 2025," Soitec chief executive Pierre Barnabe said in a statement. CONTEXT The group has been facing inventory adjustments and a sluggish smartphone market over the past year, which it had warned would continue weighing on the first half of the year, with the biggest hit to sales expected in the first quarter. One of Soitec's largest clients TSMC last week raised its full-year revenue forecast citing surging demand for chips used in artificial intelligence and strong smartphone demand. BY THE NUMBERS First quarter sales came at 121 million euros ($131.30 million), just above analysts' forecast of 118 million euros. Soitec, which has a market cap of 4.09 billion euros, kept its full-year guidance for revenue matching 978 million euros it reported last year and a core profit (EBITDA) margin of around 35%. (Reporting by Dagmarah Mackos; Editing by Tomasz Janowski)
[3]
Semiconductor Materials Supplier Soitec Reports Q1 Sales Slump
(Reuters) - French semiconductor materials supplier Soitec on Tuesday reported a 24% drop in its comparable first quarter revenue, slightly ahead of analyst expectations, as inventory correction in the smartphones market and a slower automotive market continued to weigh. WHY IT IS IMPORTANT Soitec has been banking on a rebound of the smartphone market to lift sales of its RF-SOI (radio frequency silicon-on-insular) technology used in smartphones and other wireless devices. KEY QUOTES "The absorption of our customers' RF-SOI inventories is progressing and should be completed towards the end of the first half of our fiscal year 2025," Soitec chief executive Pierre Barnabe said in a statement. CONTEXT The group has been facing inventory adjustments and a sluggish smartphone market over the past year, which it had warned would continue weighing on the first half of the year, with the biggest hit to sales expected in the first quarter. One of Soitec's largest clients TSMC last week raised its full-year revenue forecast citing surging demand for chips used in artificial intelligence and strong smartphone demand. BY THE NUMBERS First quarter sales came at 121 million euros ($131.30 million), just above analysts' forecast of 118 million euros. Soitec, which has a market cap of 4.09 billion euros, kept its full-year guidance for revenue matching 978 million euros it reported last year and a core profit (EBITDA) margin of around 35%. ($1 = 0.9216 euros) (Reporting by Dagmarah Mackos; Editing by Tomasz Janowski)
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French semiconductor materials supplier Soitec experiences a significant drop in Q1 sales, citing weak smartphone market and high inventory levels. The company maintains its full-year outlook despite the challenges.
Soitec's Q1 Performance
French semiconductor materials supplier Soitec has reported a substantial decline in its first-quarter sales, with revenues dropping by 24% at constant exchange rates to 157 million euros ($174 million)
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. This downturn is primarily attributed to the ongoing weakness in the smartphone market and elevated inventory levels across the semiconductor industry.Market Challenges
The semiconductor industry has been grappling with a series of challenges, including a slowdown in smartphone sales and excess inventory. Soitec, which specializes in manufacturing innovative semiconductor materials, has felt the impact of these market conditions. The company's performance reflects the broader trends affecting the global semiconductor sector
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.Product Segment Analysis
Soitec's product portfolio includes various semiconductor materials, with a particular focus on Silicon-on-Insulator (SOI) wafers. The company reported that sales of SOI wafers experienced a significant decline in the first quarter. This decrease was observed across multiple product lines, including both radiofrequency SOI and FD-SOI (Fully Depleted Silicon-on-Insulator) wafers
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.Outlook and Future Projections
Despite the challenging start to the fiscal year, Soitec has maintained its full-year outlook. The company expects its revenue for the 2023-2024 fiscal year to be stable at constant exchange rates compared to the previous year. This projection suggests that Soitec anticipates a recovery in demand or has strategies in place to mitigate the current market headwinds
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Industry Context
The semiconductor industry's cyclical nature is well-known, and the current downturn follows a period of strong demand during the global chip shortage. As the market adjusts to changing consumer behavior and economic conditions, companies like Soitec are navigating through a period of recalibration. The industry is closely watching for signs of recovery, particularly in key markets such as smartphones and automotive electronics
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.Strategic Implications
Soitec's ability to maintain its full-year outlook despite the Q1 slump indicates confidence in its business model and market position. The company may be banking on a rebound in demand for its advanced semiconductor materials as inventory levels normalize and new technology adoption drives growth in various sectors. As the industry evolves, Soitec's performance will be a key indicator of the health of the semiconductor materials market and its ability to adapt to changing technological needs
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