Taiwan-based quartz component makers are expected to see their combined output value grow further in the second half of 2021, driven by strong demand for 5G and Wi-Fi 6 applications, according to market sources.
Wi-Fi 6 and 5G technologies will see penetration continue rising, driving up demand for quartz crystal components for handsets and other devices adopting both technologies, the sources said.
The output value of quartz crystal components for 5G smartphones will be 25-30% higher than that for 4G handsets, and unit prices of such components for Wi-Fi 6 applications will be 200-300% higher than that of Wi-Fi 5 devices, the sources said, adding that both 5G and Wi-Fi 6 applications will serve as major growth drivers for quartz crystal components makers.
Supply of small-and medium-size quartz crystal components has stayed tight due to strong demand from segments of notebook, automotive electronics, IoT, networking equipment, 5G handsets and base stations, while OCXOs (oven controlled crystal oscillators) and TCXOs (temperature controlled crystal oscillators) also see great growth potential for high-end applications, the sources continued.
Taiwan's leading quartz crystal vendor TXC has pointed out its overall order visibility is clear through the third quarter of the year, with some clients even placing orders for popular-specs components through the end of the year to secure supply. The company is optimistic that its revenues will ramp up steadily through the peak season.
TXC's first-quarter 2021 revenues expanded 2.39% sequentially and 53.9% on year reaching NT$3.311 billion (US$118.25 million), a record high for the same quarter. Its corresponding pretax profits shot up 143% on year to a new high of NT$737 million, with gross margin advancing 5.3pp sequentially to 35.5%.
To meet strong demand, TXC has raised its 2021 capex to a fresh high of NT$2.59 billion, more than half of which will be used to support capacity expansions for small-size offerings at its plants in Taiwan and China.
