Wenmao's revenue accumulated in the first two months of this year was NT$3.981 billion, with an annual growth of 68.64%. The overall performance is still better than market expectations, mainly benefiting from the application demand related to 5G gallium arsenide. Foreign investors are optimistic about Wenmao's 5G-related gallium arsenide orders in the long run, which will only be deferred and will not completely disappear due to the impact of the epidemic.
Wenmao said that the first quarter coincided with the off-season for traditional gallium arsenide shipments. Coupled with the interference of the epidemic, the quarterly revenue recession rate may be above double digits, which roughly meets market expectations. According to the legal analysis, Wenmao's current product portfolio has a gross profit margin of more than 40%, and the customer has not experienced order reduction, and the capacity utilization rate continues to remain high.
Wenmao still conducts capital expenditures of about 6 billion yuan according to the previous plan and launches a second wave of capacity expansion plan. It is expected that 5,000 pieces of production capacity will be expanded in the second quarter. After the Guishan plant has expanded production, it still has 10,000 pieces of production capacity, which can be resiliently increased and decreased production capacity in response to customer needs in a timely manner.
Foreign analysts said that although the COVID-19 epidemic has impacted market investment confidence, the demand for 5G-related business opportunities is only deferred and does not disappear. Countries around the world will continue to release 5G spectrum, especially the mainland region will vigorously accelerate the number of base stations in 5G infrastructure construction. In addition, the VCSEL demand for 5G smartphones has also shown a multiple growth. Therefore, Wenmao customers' demand for gallium arsenide orders has increased.
legal person has judged that the previous important VCSEL orders were the face recognition module of the iPhone, and currently the launching orders of ToF lenses have been taken over one after another. Last year, many mobile phone factories such as Samsung and Huawei have launched flagship models equipped with ToF lenses. It is expected that Apple will also plan to launch new iPhones with 5G specifications in the second half of the year to fully equipped as standard equipment.
In addition, Android followed the pace of iPhone and gradually imported VCSEL hardware applications. Wenmao said that with the 5G smart phone frequency band plus MiMo specifications, the use of PA will increase by at least 2 to 5 pieces for mobile phones, so the market expects that with the wave of 5G smart phone replacement, PA will be in short supply.
Manuscript source: United Evening News
