Walsin Technology Corporation (stock code 2492) released its Q3 2024 financial report. The company achieved Q3 EPS of 4.73 TWD, nearly matching its full-year 2023 performance, while 9-month cumulative EPS reached 9.66 TWD, marking a five-year high. Strong AI server demand drove high-end MLCC orders as Japanese and Korean manufacturers' capacity constraints redirected orders to Taiwanese suppliers.
Walsin Technology Reports Q3 Revenue Growth of 46.82% Year-Over-Year
Walsin Technology's Q3 consolidated revenue reached 13.82 billion TWD, up 32.55% quarter-over-quarter and 46.82% year-over-year. Gross profit totaled 3.847 billion TWD, increasing 84.44% QoQ and 143.91% YoY. Operating profit reached 2.634 billion TWD, up 213.23% QoQ and 417.43% YoY. Net profit for the period totaled 2.585 billion TWD, rising 105.74% QoQ and 92.17% YoY. Net profit attributable to parent company shareholders reached 2.294 billion TWD, up 91.83% QoQ and 116.92% YoY. Q3 basic EPS stood at 4.73 TWD, exceeding Q2's 2.46 TWD and the prior year's Q3 figure of 2.19 TWD, nearly matching the full-year 2023 EPS of 4.74 TWD.
Nine-Month Cumulative EPS Reaches 9.66 TWD
For the first nine months of 2024, Walsin Technology's consolidated revenue totaled 34.669 billion TWD, up 25.12% year-over-year. Gross profit reached 7.888 billion TWD, increasing 67.83% YoY. Operating profit totaled 4.515 billion TWD, up 191.60% YoY. Net profit for the period reached 5.371 billion TWD, rising 186.99% YoY. Cumulative net profit attributable to parent company shareholders totaled 4.685 billion TWD, surging 228.09% compared to the prior year. Nine-month basic EPS reached 9.66 TWD, significantly exceeding the prior year's 2.95 TWD and marking the highest level for the period in five years.
Japanese passive component leader Murata Manufacturing reportedly added MLCC capacity investments, with its order-to-shipment ratio reaching an all-time high. AI server demand remains at full capacity, and MLCC price increases benefit Taiwanese manufacturers. Walsin Technology maintains high order visibility, with some products extending into the following year. Due to simultaneous increases in raw material, labor, and expansion costs, Walsin Technology has indicated a pricing adjustment direction. Market observers note the need to monitor whether distributor price increases can extend to direct customers and whether improvements in high-end product mix can continue to reflect in revenue.
TrendForce Forecasts MLCC Supply Constraints Through 2027
Regarding the MLCC industry, TrendForce research manager Chen Wei-sheng presented "2027 MLCC Market Outlook: AI Crowding-Out Effect Continues, High-End Structural Shortage and Volume-Reduction Value-Increase." Benefiting from sustained strong AI demand, the MLCC industry in 2027 will continue the "strong AI, weak consumer" pattern. Chen Wei-sheng noted that Japanese and Korean manufacturers continue shifting capacity toward AI high-end MLCC, squeezing supply of consumer-grade high-capacitance products and driving order spillover to Taiwanese and Chinese manufacturers. The order transfer effect is expected to continue throughout 2027. However, due to extended equipment delivery times and new capacity ramp schedules, Japanese and Korean manufacturers' new capacity will not significantly increase until Q1 2028 at the earliest, meaning 2027 MLCC supply will remain difficult to effectively relieve.
For Taiwanese manufacturers, Yageo Corporation (stock code 2327), Walsin Technology, and other companies have indeed benefited from Japanese and Korean manufacturer order transfers, but current benefits primarily concentrate in consumer-grade high-capacitance MLCC. Chen Wei-sheng analyzed that while Taiwanese and Chinese manufacturers have expansion plans, consumer-grade high-end MLCC capacity expansion remains quite limited. Beyond extended equipment delivery times, production yield rates also face challenges requiring time to overcome.
Yageo previously mentioned in its investor conference that MLCC and tantalum capacitors will have 10% to 15% expansion plans for the following year. However, Taiwanese and Chinese manufacturers still have many product specifications not yet entered into international manufacturers' approved vendor lists (AVL), so opportunities to further penetrate the AI high-end MLCC supply chain remain relatively limited.
Regarding pricing, 2027 MLCC will show clear structural differentiation. Chen Wei-sheng pointed out that AI-grade MLCC still has room for price increases in the following year, but whether prices can increase quarterly still depends on whether suppliers can continue increasing supply. Consumer-grade products, affected by weak smartphone and laptop demand, may see simultaneous decline in orders and supply, with price increase magnitude also limited. Only medium-to-high capacitance products are expected to retain some pricing power.
FAQ
What was Walsin Technology's Q3 2024 EPS performance?
Walsin Technology achieved Q3 2024 EPS of 4.73 TWD, up from Q2's 2.46 TWD and the prior year's Q3 figure of 2.19 TWD. The Q3 result nearly matched the company's full-year 2023 EPS of 4.74 TWD.
Why did Walsin Technology's profits increase significantly in Q3 2024?
The profit increase stemmed from strong AI server demand driving high-end MLCC orders. Japanese and Korean manufacturers' capacity constraints created order spillover to Taiwanese suppliers, while simultaneous price increases in the MLCC market contributed to improved profitability.
What is TrendForce's forecast for MLCC supply in 2027?
TrendForce research manager Chen Wei-sheng stated that MLCC supply constraints will continue through 2027. Japanese and Korean manufacturers' new capacity will not significantly increase until Q1 2028 at the earliest due to extended equipment delivery times, meaning 2027 supply will remain difficult to effectively relieve despite sustained AI demand.
