Nanya Technology (2408) Q4 2024 earnings summary

Executive summary

• Q4 2024 net sales were NT$6,575 million, down 19.2% sequentially, with a net loss of NT$1,574 million and EPS of -0.51; full-year 2024 net sales reached NT$34,132 million, up 14.2% year-over-year, but the company remained unprofitable with a net loss of NT$5,083 million and EPS of -1.64.

• Gross margin improved to -1.2% for 2024 from -15.0% in 2023, mainly due to higher ASP and lower idle costs, but Q4 gross profit was negative, impacted by idle costs from power outages and production cuts.

• The company is ramping up second-generation 10nm-class technology, with DDR5 production exceeding 20% of output and targeting over 30% in 2025; 16Gb DDR5 5600 delivered in Q4 2024, 6400 version targeted for H1 2025.

• Nanya Technology operates globally in DRAM and semiconductor products, with KPMG issuing an unmodified audit opinion for 2024 financials.

Financial highlights

• Q4 2024 gross loss was NT$695 million, including NT$639 million in idle costs; operating loss was NT$2,812 million; EBITDA was NT$1,185 million; net margin was -23.9%.

• Full-year 2024 gross loss was NT$421 million, improved from NT$4,483 million in 2023; operating loss was NT$10,555 million; net margin was -14.9%.

• Book value per share at year-end was about NT$53.

• Cash and cash equivalents at year-end 2024 were NT$61,902.8 million, with net cash of NT$36.6 billion.

• Free cash flow for Q4 2024 was -NT$3,630 million.

Outlook and guidance

• 2025 CapEx planned at up to NT$20 billion, pending board approval.

• Bit shipment is expected to grow over 20% in 2025, after being flat in 2024.

• Market recovery for non-AI DRAM is anticipated in the second half of 2025, with AI-related demand remaining strong; DRAM market may bottom out in 1H 2025.

• Cost reductions, especially in depreciation, are expected to improve margins by Q4 2025.

• Continued economic uncertainty from geopolitical tensions, interest rates, and inflation may impact DRAM demand and inventory valuation.