High-speed transmission chip specialist Parade Technologies has newly projected a notable sequential fall for third-quarter 2022 revenues as clients will remain keen on adjusting inventories throughout the year, according to the Taiwan IC design house.
The company has reported its second-quarter revenues grew 2.84% sequentially and 23.65% annually reaching US$216 million, a performance within the projected range of US$212-232 million.
The company has estimated its third-quarter sales at US$150-166 million, down 27% sequentially if based on the midpoint figure.
Its chairman Jack Zhao said at a recent earnings call conference that the projected sequential fall for third-quarter revenues is mainly due to a sharp decline in demand for mostly Windows-related notebook and other PC applications.
He continued that there are still massive inventories to be digested by supply chain players including clients, channel distributors and even panel makers, which will take at least two quarters to complete.
Zhao also noted that Parade has projected its gross margin at a healthy range of 44.5-48.5% for the third quarter thanks to constant improvement in shipment portfolios.
He disclosed the company’s shipment ratio for high-speed transmission interface ICs has risen significantly as it continues to cut into high-end automotive and server applications, enabling it to sustain gross margins amid inventory adjustments at clients.
Zhao has expressed optimism about notebook applications in the longer term, reasoning that each high-end gaming notebook requires 6-7 high-speed transmission chips, compared to 2-3 chips for general models and that the company has just commercialized its USB 4 Retimer for high-end notebooks, with no inventory problem for the new offering.
Zhao said Parade will continue to strive for more 28nm foundry capacity for its high-end chips solutions including USB 5 Retimer to be rolled out soon.