Nanya Technology (2408) Q3 2024 earnings summary

Executive summary

• Q3 2024 net sales were NT$8,133 million, down 18% quarter-over-quarter but up 5.1% year-over-year, with a net loss of NT$1,487 million and EPS at NT$-0.48.

• Gross margin was 3.2%, with operating margin at -30.8% and net margin at -18.3%.

• EBITDA for Q3 was NT$1,520 million, EBITDA margin at 18.7%, and book value per share stood at NT$53.17.

• Q3 results included a NT$475 million loss from a power outage, impacting profit and wafer production.

• ASP increased by mid-single digits, but bit shipment declined by low twenties percent quarter-over-quarter.

Financial highlights

• Operating loss was NT$2,505 million, with operating expenses rising mainly due to a NT$140 million increase in R&D.

• Non-operating income reached NT$677 million; income tax benefit was NT$341 million.

• Free cash flow for Q3 was negative NT$7,459 million; net cash and equivalents at quarter-end were NT$38.2 billion.

• Ending cash and equivalents were NT$61.1 billion after debt.

• Earnings per share was NT$-0.48.

Outlook and guidance

• 2024 CapEx guidance reduced to NT$20 billion from NT$26 billion due to equipment shipment and payment delays.

• Bit shipment growth target for 2024 revised down to ~10% year-over-year from >20%.

• Q4 ASP is expected to remain challenging, with significant DDR5 contribution and ASP improvement anticipated in Q1 2025.

• Mass production of 1B 8Gb DDR4 and 16Gb DDR5 has begun, targeting over 15% input capacity by Q4 end.

• Plans to introduce 1B LPDDR4 and LPDDR5 in 2025; 1C product development is on track.