  SPIL expects 3-5% growth for 3Q, predicts moderate industry growth Cage Chao and Amy Lee, Taipei; Jack Lu, DigiTimes.com [Thursday 5 August 2004] Siliconware Precision Industries Ltd (SPIL) projects its third-quarter revenues will grow 3-5%, company chairman Bough Lin said during an August 4 investors conference. Lin also remarked that the industry will grow steadily over the next three to four years. In the third quarter, the PC segment will see seasonal growth, but sales of memory ICs are expected to drop slightly, Lin stated. He forecasted that sales in the consumer electronics segment will drop as customers need to adjust inventory. Sales from the communications segment will increase slightly or remain flat. Average selling prices (ASPs) will stay flat or fall slightly this quarter, while gross margins will also remain flat, Lin added.
SPIL will utilize 90% of its packaging capacity this quarter, up from 85% last quarter. Utilization rates of its testing capacity will stay above 70% this quarter. Remarks Following a projection for the company’s growth, Lin made four observations on the overall semiconductor industry. First, the industry will grow at a more moderate pace over the next three to four years, as compared to the current upcycle.
Lin said the pace would change as product migrations are nearly complete. As an example, Lin listed the migration from monochrome handset to color handsets as a key driver for boosting chip sales since mid-2003. Second, the high inventory issue many analysts are worried about are not industry-wide, and the supply chain will digest excess inventory over the next three to six months. Third, chip supply may outpace demand over the next six months, but the balance will resume in the long term. The last point Lin stressed was that chipmakers need to continue investing in high-end technologies to maintain long-term competitiveness. 
