力積電's Q3 Results Imply 47.6% Gross Margin After Price Hikes

Foundry 力積電 (6770) shifted to core manufacturing profit in the third quarter, with preliminary figures implying a 47.6% gross margin as higher wafer pricing flowed into results.

The company released preliminary results on Oct. 21: revenue was NT$21.34 billion, gross profit was NT$10.15 billion and net income was NT$6.5 billion. Earnings per share were NT$1.38. The 47.6% gross margin is calculated from the preliminary, self-compiled results, which had not yet been reviewed by an accountant.

Gross margin was 28.28% in Q2, up from 10.23% in Q1. Revenue increased about 23% from Q2 and about 80% from Q3 a year earlier. In Q3 2025, the company had a gross loss of NT$770 million and a net loss of NT$2.73 billion.

The earnings mix also changed. In Q1, net income was NT$14.23 billion while net other gains and expenses came to NT$15.37 billion; gross profit was NT$1.39 billion. By Q3, gross profit was the main earnings contributor.

力積電 adjusted product prices in February and raised DRAM wafer-start prices by 45% in July. At a July 14 briefing, General Manager 朱憲國 said higher average selling prices, rather than larger shipments, drove Q2 revenue growth. He expected the July pricing changes to feed into revenue and profit gradually from November as wafers moved through production.

The company's monthly revenue explanations for August and September cited stronger customer demand, increased sales volume and price adjustments. September revenue reached NT$7.7 billion, up 94% from a year earlier.

At the Oct. 21 briefing, 朱憲國 said the average selling price for memory foundry output in Q3 still lagged wafer-start pricing by about 30%, and that logic foundry price adjustments also supported revenue growth. He projected double-digit revenue growth in Q4 and set a target to raise foundry prices by 10% to 20% in 2027. With mature-process capacity tight, 力積電 is negotiating long-term customer agreements to lock in prices and volumes.

Vice Chairman 謝再居, serving as acting chairman, said the company hopes to obtain another small semiconductor factory within three to five years. It is studying locations in Taiwan, Singapore and Japan as clean-room space runs out. He said he wants customers to contribute 30% to 60% of expansion investment through equipment leases or advance payments, reducing the company's investment risk.