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PHOENIX SEMICONDUCTOR Philippines Corp. (PSPC) began commercial production of high-density memory cards used in mobile devices, smart televisions and global positioning systems (GPS), among others.
In a statement issued on Tuesday, the listed company disclosed it targets to produce a total of 5.8 million embedded multimedia cards within the quarter, following the trial production of 2.8 million units in the latter part of 2016.
The initial output passed qualification and quality audits by Samsung Electronics Co., Ltd. of South Korea, allowing PSPC to commence its commercial production of the memory devices.
“The expansion of PSPC into the production of this new generation of memory device earmarked for mobile products is another step in the evolution of the company,” PSPC President Byeongchun Lee noted in the statement.
PSPC is diversifying its semiconductor manufacturing capability, as SFA Semicon Co., Ltd. grooms its Philippine subsidiary to become its manufacturing hub in Asia.
Embedded multimedia cards can store 128-256 gigabytes by using vertically embedded multimedia card interface, flash memory and controller in a compact format. These are used in mobile products with medical, aerospace and industrial applications aside from personal devices.
While orders are still being finalized, PSPC expects that monthly placements will exceed “significantly” those recorded in 2016 amid the rising demand for mobile products and the development of more GPS and navigation-based applications in other end-products.
PSPC looks to expand into higher-capacity embedded multimedia card formats for other applications, Mr. Lee said.
“Prospects for eMMC based memory solutions are positive, with industry analysts projecting production revenues to reach about $30 billion by 2022 because of the continued advancement of many mobile platform and applications,” the executive noted.
PSPC started its commercial operations in February 2011. At present, the company’s major product lines are dynamic random access memory and memory chips for computers and Samsung-branded memory secured digital cards.
In December 2014, PSPC raised P468 million from an initial public offering for the first phase of expansion of its production plant within the Clark Freeport, Pampanga. The proceeds mostly funded the installation of a memory card packaging production line in 2015.
In January, the company announced the commencement of the second phase of its expansion in Pampanga. It will implement the project in two stages.
PSPC will first construct a manufacturing building with an initial production footprint of 18,000 square meters (sq.m.), a warehouse spanning 1,000 sq.m. and a power utility building until end-August. The second part of the expansion project will push through in 2021.
The expanded facility will accommodate the semiconductor assembly and packaging contracts of SFA Semicon and customers aside from Samsung.
In the first nine months of 2016, the company booked a 50% year-on-year decrease in net income to $6.02 million from $12.08 million. The decline largely reflects the 31% plunge in revenues because of weaker demand.
Shares in PSPC closed 21 centavos or 11.29% higher at P2.07 apiece on the Philippine Stock Exchange on Tuesday, bucking a downtrend in the market.