Touchscreen and LCD driver solution provider FocalTech Systems swung to net losses of NT$103 million (US$3.51 million) in 2017. EPS came to negative NT$0.28.
FocalTech indicated its net losses for 2017 included the recognized special income tax expenses generated by its US-based subsidiary.
FocalTech reported consolidated revenues increased 3% on year but declined 15% sequentially to NT$2.77 billion in the fourth quarter of 2017, while gross margin slid to 20.4% from 20.6% in the prior quarter and 23.3% a year earlier. The company generated net losses of NT$260 million in the fourth quarter with EPS arriving at negative NT$0.87.
FocalTech attributed the negative income results to a one-time charge of about NT$246 million related to the US tax reform incurred by its US subsidiary, while a seasonal slowdown in demand for smartphones dragged down FocalTech's fourth-quarter revenues.
FocalTech reported revenues slipped 2% on year to NT$10.8 billion in 2017, while gross margin climbed 0.4pp to 21%. The company generated NT$204 million in pre-tax profits during the year.
FocalTech expects to post another sequential revenue decrease in the first quarter of 2018. Fewer working days during the Lunar New Year period will reduce its handset clients' output to the lowest level for 2018, the chip supplier said.
Nevertheless, shipments of FocalTech's TDDI (touch with display driver integration) chips dubbed IDC (integrated driver controller) remain brisk and will help limit the anticipated revenue drop sequentially in the first quarter, the company indicated.
FocalTech reiterated its optimism about TDDI chip demand for all-screen smartphones in 2018. Sales of its IDC chips will be driving the company's overall revenue growth during the year.