Largan Precision Co., a supplier of smartphone camera lenses to Apple Inc., reported Tuesday that its sales for March surged more than 40 percent from a month earlier due to an increase in the number of working days.
In a statement, Largan said its consolidated sales rose by 43 percent from February to NT$3.76 billion (US$131 million) in March, with the nine-day Lunar New Year holiday this year falling mostly in February.
On a year-on-year basis, however, Largan’s consolidated sales in March fell by 6 percent but the decline was much smaller than February’s 19-percent fall, according to the company’s data.
Largan said its consolidated sales for April could be lower than March’s due to weaker demand from many of its customers.
The global smartphone market has showed signs of weakening amid rising inflationary pressure as well as concerns over the war being waged by Russia against Ukraine, according to analysts.
According to a report posted in late March by Nikkei Asia, Apple scaled back its orders for the newest iPhone SE, which just hit the market that month, as well as the latest flagship iPhone 13 series. In addition, Apple also cut orders for its Airpods wireless earphones.
However, Largan said its products used in automotive electronics still made a meaningful contribution to its sales in March.
In the first three months of this year, Largan’s consolidated sales dropped by 14 percent from a year ago to NT$10.13 billion, which analysts attributed to increased competition.
In March alone, lenses with a resolution of 20 megapixels or more — a higher-margin product and one of Largan’s specialties — accounted for 10-20 percent of total sales, the company said.
Lenses with 10-20 megapixels accounted for 40-50 percent of Largan’s sales, 8-10 megapixel lenses made up about 10 percent, and other products such as voice coil motors contributed 30-40 percent in March, the company said.
Largan is expected to hold an investor conference in mid-April to detail its first-quarter results and provide guidance for the second quarter.
In 2021, escalating competition pushed down Largan’s net profit year-on-year by 24 percent to NT$18.66 billion or NT$139.13 per share, the lowest since 2013 when the company’s earnings per share stood at NT$71.64.
Last year, Largan’s gross margin — the difference between revenue and cost of goods sold — fell by 7.02 percentage points from a year earlier to 59.95 percent due to a weaker product mix, with lower-end camera lenses accounting for a greater proportion.
Source: Focus Taiwan News Channel