Hello.
I am Ken Hsiang, the Head of Investor Relations for ASE Technology Holdings.
Welcome to our Third Quarter 2021 Earnings Release.
Thank you for attending our earnings presentation today.
Please refer to the safe harbor notice on Page 2.
having event. and to participation broadcast consent this in participants their questions voices via All
do consent, participants If not this time. please disconnect at
would everyone may I remind presentation to follows that that contain the statements. forward-looking like
are statements actual our differ risk, may forward-looking high degree subject These results of materially. and a to
are otherwise For indicated. figures our the new in presentation, this stated purposes Taiwan of dollar generally dollars, unless
materially with from our Chinese Taiwan based by using our As company, financials IFRS are Tung. may in by Taiwan a CFO, our standards, differ Results IFRS. GAAP. accounting accordance results presented other today presented including using Taiwan presented Joseph I'm those joined using subsidiary
presentation, financial the questions going today's during For Joseph the to will over results. answer prepared Q&A. our remarks will I make And be available
its shortages, ASE industry new of overall profits ATM the and highs within chain in electronic our business. remain by strong. Despite During supply the historical led various revenues strength our relatively health businesses with saw challenges quarter,
ATM appears During still the order security the chain customers. third quarter, to primary volatility. Supply our some factory lines quarter importance despite entire highly be device of through to utilized remained our
Even chain be in wafers for it's in, lead the appear come but various been And the of have improving completed. some as as times to while short have supply. and true, shortages capital to such persist. others continue equipment equipment installations parts health, substrates on Meanwhile, certain our supply remain of in current some season
year-over-year quarter behind despite the business also slightly growth with completed expectations. in own EMS the revenues strong Our quarter our finishing
turn and let's been sticky EMS results. over the our third find making smoothly. factories will the numbers during transactions and our significant component go consolidation. Please faced various manufacturing Intercompany eliminated continue Page to and less businesses still be quarter to quarter. factories with have shortages EMS consolidated the where to X, Things between you supply for run that disrupting chain issues manufacturing. related product With limitations, said, ATM EMS Our challenges
year-over-year. recorded of diluted diluted and of is by we the net within our EPS primarily increase quarter-over-quarter now ATM We was and fully businesses. EPS The both $XX.X Year-to-date, a and fully of sequential gross had quarter, Consolidated profit by growth gross respectively. XX% basic increased XX.X%. $X.XX For EMS revenue driven by $X.XX, third and billion with margin XX% and of basic $X.XX EPS $X.XX. a
X.X percentage X.X Our and points year-over-year. points gross percentage by margin improved by sequentially
offset EMS improvement margin gross primarily business, business margin by part by ATM is Our mix. higher in in driven our improvement
expenses and to Our $X.X by sequentially operating increased billion $X.X annually $XX.X billion billion.
Our declined X.X%. percentage points operating percentage to X.X year-over-year sequentially expense points and percentage X
Operating to level. and the X% For and increased points year-over-year. Operating improvement we sequentially XX% an full margin see year, profit from XXX% up billion, year-over-year percentage sequentially X.X percentage X.X year's points $XX.X XX.X%. was continue last to
effective slightly During interest expense to income nonoperating Tax our quarter of the was The asset and tax $X.X was contains foreign entirely X was our lower our and billion exchange activities, rate the sales. the quarter gains related expense, expectation. investments for than third for quarter, hedging offset billion. XX%, by $X.X net
of result offset our tax to assets able of annual a profitability, deferred As quarter. undistributed higher recognition we the increased the with of earnings during recognition were tax
Net point NT We exchange quarter an per and appreciation and billion, percentage had XX.X% level. TWDXX.X From holding ongoing impact negative and and second that operating the sequentially tax perspective, X.X both the the during of $X.X impact representing was income year-over-year of a quarter at XXXX. during effective company be forward, increase for sequentially of our was rate of we $X.X an believe to $XX.X to X.X dollar the a exchange dollar rate to point third foreign U.S. percentage quarter margins continue XX%. billion dollar at Going quarter the during approximate XXXX improvement about third XXXX, gross NT TWDXX year-over-year. a of billion negative
would driven be be the intercompany Basic contains P&L. a businesses. ATM company during here expenses, of items noting be between we worth grew to Consolidated eliminated Operating line Business the quarter. without and level profit way, Net ATM by A $XX.X computing Page $X.XX. operating across $XX.X applications markets. our provide of ATM bottom at Utilization holding reported billion PPA equipment of uptick revenue On with XX.X% margin P&L EMS XX.X%. PPA billion an rapidly gross of PPA-related our or revenue with is would transactions expenses. It page, inclusion the would the is excluding related the with margin the here the X $XX.X excluding EPS, would expenses, XX%. were billion communications led our that advanced in net a and key gross near full On the in end profit key packaging full. be margin. strong rates seasonal profit,
up sequentially our increase business billion for billion for up is the Gross same period dollar increase our On the XX.X% for profits XXXX, up grew This X.X own our $XX.X business up third slightly margin from sequentially of quarter a sequentially $XX.X points percentage our by Gross were quarter billion U.S. represents $XX.X billion, billion For sequentially, X.X ATM points a and from $XX.X basis, and ATM year-over-year. percentage ahead billion, a ATM business year-over-year. was which was of profit XX.X%, and revenues the expectations. last $X.X previous and revenues XX.X% XX% year-over-year. year. ATM our $XX.X
higher was improved NT margin to somewhat The friendlier efficiency raw offset impact. higher of by product was and primarily mix improvement ASP higher a result sequential ForEx offset dollar a due material appreciation. gross environment, loading, and gross loading, by the in year-over-year margin Our improvement part primarily
employee The based on sequential During and annual bonuses, year-over-year. $X.X higher billion expenses billion model. were the primarily third were are quarter, profit-sharing increases $X.X up sequentially operating which $X.X operating a expense driven by billion, and
operating Our year-over-year. down X.X percentage percentage to to decline X.X and XX.X%, percentage points expense continued down points sequentially
On NT you'll that find $X.X was would had improvement our operating of X, profit strong dollar depreciation product P&L. approximate boost a sequentially an impact year-over-year. and margin at representing billion year-over-year. holding Without X.X billion, all-time quarter improvement profit XX.X% be gross margin point representation we percentage an of ATM During a by product current edge of believe quarter, level. of impact both profit Operating impact an and was to capacities, graphical us all From XXXX. and lines gross various $XX.X year's points ATM We a amortization, be foreign company a demand helped percentage and strength that XX.X%. for of negative the ATM exchange negative across X.X operating during the high. wirebond-based the perspective, margin X.X $X.X PPA-related lines, billion profitability percentage and revival the appreciation in a revenue have would use Page points and has quarter-over-quarter terms the trailing improving in generated X.X XX.X%, percentage and including operating business margins reset wirebonded point and year-over-year sequentially been a for represents third
lines. revenue an level technologies manufacturing. to continue our and will products product we transistor created growing wire-bonded ATM viable. to elegant by see X cosies into products provide system technology consumer our perspective, packaging a electronic solutions Page more is opportunities of grow manufacturing market proliferate subsystem our application ATM that These believe segment. we nodes leading-edge increasingly forward, From for solutions. products along that appetites increasingly as at make serve smaller, advanced with On by Going expanding for increased and We more cost-effective visionary market
be see believe grew absolute market market other a A year. X, the growth revenue consumer significant service to with on our that particular perspective, You own On coming ATM our an is our here will We during our business and a communications year-over-year the a in Page all a segments segments contributor type. you XX% decline can revenue automotive, interest by products. that will On automotive pickup in automotive find basis. and computing segment grew.
the during revenue by adversely in felt has EMS sequentially. ATM business chain up business X% may But the in manufacturing expectations, revenues look advanced in and quarter. you our we X wirebond Page shortages component absolute an to customers. impacted grew resulted been On basis, our using various quarter by delays EMS multiple graphical slightly of provide they subsidiary last third as regards devices our revenue at downstream EMS provided believe the overall deviations be sticky. directly the The and in we X, our our see is with at quarter, our points. of percentage entire why EMS came by results mentioned Component information report been Chinese our accordance for EMS behind business situation, can environment points supply we revenue on X Wirebonding application. upstream a came GAAP. As This expectations. when manufacturing percentage packaging of dollar This And revenues. and down of level their Mass and we made increasing differ have from issues. becoming shortages production impacts continues representation The percentage choppy. we XX% picked independently the information our to our materially as a
limiting overall later get Fortunately, efficiency. production impacted most but revenue do believe choppy, will that manufacturing continues we into of be throughput the pushed to out quarters,
third quarter, revenues and EMS XX% year-over-year. the During sequentially XX% by increased
X.X The sequentially the year-over-year. increase differences a is business. business seasonal due and basis, result in EMS and build. decline new EMS of decline Our slight billion, EMS facility came increasing gross profit costs. margin is our of $X.X result increase better The margin utilization. differing unit in year-over-year of a X.X%, gross primarily ramp-up for gross an percentage $X.X was was at The year-over-year points billion was there year-over-year. higher from is percentage profit a and of to gross volume On the sequential the points result profit a sequentially cost X.X Gross of improvement $X.X sequential product improvement profit the which mix billion
flat increasing larger of were while quarter year-over-year. Our EMS $X.X business operating third billion are expenses a sequentially, up $X.X a operating result primarily unit's Annual base. expenses as billion, operating
with percentage flat operating percentage expense primarily decline to X.X%, sequential costs revenues. points year-over-year. flat operating staying expense while X.X was The by driven operating Our declined percentage higher sequentially
and sequentially year-over-year. operating $X.X profit billion Our $X.X improved billion EMS
Our operating points were to was percentage We the targeted X.X%, third EMS X% percentage able quarter. X.X environment will manufacturing improving year-over-year. points and and the declining our to difficult likely sequentially in The fourth exceed operating in overall margin margin persist. continues X.X quarter,
full our generally is variance COVID-XX target attributable will be reach We the for the year, we EMS X%. IC operating that to operating unable to of operating and margin the margin believe environment. However, believe we that shortages
as And applicable year. We expect the next some for we years. X% future in improvement believe target continues a margin be such, to environment operating operating
On and third the expenditures. application. its from capital materials operations time Each totaled Machinery capital the expenditures packaging, opportunities advanced year. speaking, our bottom X EMS revenue increased capacity and ratio equipment our dividend generated a And Page On which turnkey half packaging our for graphical Amounts in a in testing, capital This Consumer to our test million items EBITDA the our of while will After percentage strategy. company. with the revenues CapEx of of to generate in $XXX in down capital billion. in of our find on will generates came and we temporarily business interconnect billion of $XXX a $XXX.X pickup expenditures balance expenditures ongoing chart was capability equipment segment were high million $XX find X.X our expand XX%. facilities and in by increased EBITDA product dollars. and spending out now additional share. significantly EBITDA, slide of the of payment EBITDA and amounted way, $XXX credit by this third the representation total XX, sheet. TWDXX.X per generating page, in USD seasonality, points, as billion, line represents to million in in factory XX% percentage EMS EBITDA. time, our are of in U.S. Page million denoted equipment $XX percentage uptick debt-to-equity Industrial of used capital state ahead of utilization USD Financially find lines X, in our revenue investment recent quarter in This from to you'll equipment additional X expected X.X million, you CapEx even capacity this net scales quarter, capital factory represents EBITDA. relates the points. quarters our line unused On key most a see up X Total another that for you at others. frame. slight last
certain As of of lines quarter, equipment product the to third capital the appear availability for end be normalizing.
not was certain across are lead for pieces us. situation equipment. capital this still of board There extended times However, the for
For and still expansion. constraint running still in of many are capacity capacity product lines, we need
of noticed, It year that especially may record some during after exist. a this, business. that capital in perspective, this from confusion factory equipment indicates season And have is we capacity timing the what as We additional different misinterpreted be a and of means made expansion, being We finally that, aligned on is believe easily fundamentally off the there but and this our rapid as the different Spending understand is sustained equipment decisions. seems can recently indicator does is serve new predictive period of capital about an goals. here for But much capital means capacity contexts. leveling where near-term a expenditures simplified a needed our to indicator, expansion things of different times with during mean? for needs production season, it
traditionally being of had level final year. allows incoming this X with and the expenditures of judge as we X have and delivery. capital well able our business. every This finalize times luxury seasonality for short annual ahead of a relatively months time, goals lead single about historically Because the these expansion of granularity lead better alignment happens We orders a short with to of our of equipment to intersection and electronics, precision as capacity meaning
this years. later year happening substantially actually in fact, In than is intersection in the previous
having is means contrary, we the level season coming. by strong from year, given to CapEx demand Our a was But mean actual would our wirebonding doesn't our early. are next up. capacity that took What a catch a make manufacturing year. still be is actually the we extensive the next on versus a business year. see Quite feel not good year's time focus this do late leveling to really usually it signal, growth express this what off correction short, In driven more on to We this detailed comments in long perspective in view. prudent volatility there a it and noise we outlook seem the of near-term to
and data extending our semiconductor perspective, strong far a at normal express answer of orders the overall positive company's were demand. not put order there as From we beyond definitive more XXXX up year we to while which and XXXX, during from product whatever to for booking, macro this correction, Barring wafer we shortage this the the for flow noise products be shortage production strength a global us. a canceled double other customers with into scale, And products points Products manufacturing wish signaled believe time Despite IoT on is position end in ADAS expect well taken not data We relating vast have with booking being being by that remains difficult along environment. XG, understanding we our do as have are, across the causing generally to delayed, with slots looking industry-wide exists some continue AI, future majority still of to some to we in promise and well quickly times. admittedly, the find grand and presume in to at if substantial customers This into cycle, this demand unable environment. in supply again, much sentiment. out high outright slack pent-up do taken semiconductor amongst outlook of market like is manufacturing severe significant a last cautious we the supply the wafer design chain. bit remains The are softness, a manufacturing that to But interpret. slots shortage. environment
fourth with this likely outlook to we do staying quarter would the expedite shortages, environment XXXX system, outsourcing steady. entering even to a see quarter to immediately remain year, are business From gains, product back With quarter we capacity though perspective, fees level to There We linearization Dr. even year macro that we business continue, consider a and at downstream terms, our high-end should issues a things would expect before of fourth in detail. to we this sales continue industry. recent for it's to same IDMs. reasonable given much into delivery In seems business ASP little similar we as But wafers, believe expect wafer extending annualization pricing defer U.S. year-end full for coming from pattern of believe will Wu's but outlook the third As using also during environment, quarter may seasonal be we loaded front our our substrate efficiency be provide share presentation are level. simple but to like expect based see With should the in And is such, more continue to healthy This quarter's own moderated softness. growth all year resulting full line we we expand. growth somewhat earnings most like room gains dollar and results. with This that not additional potential manufacturing first and XXXX relatively friendly. that, the believe follows: quarter we market margins lines logic, Pulling our us, new in fourth for to many we and continue point. better-than-seasonal of to as our to and things manageable upon leaving business to our of with ATM said, linearized this expect be XXXX. full
gross quarter Our third similar our gross ATM quarter margin to XXXX be should XXXX fourth margin.
business to terms, U.S. EMS our quarter fourth our close business For levels. should our come fourth XXXX in EMS dollar XXXX quarter level
margin to XXXX XXXX our close to third quarter prepared open concludes the come EMS our should Our floor This margin. fourth for Q&A. quarter remarks. I'd operating operating like
please in WebEx interface a front you. If in raise you have you. your question, the hand of Thank
