Market News

ANAHEIM, CA – Multi-Fineline Electronix Inc. (MFLEX) reported second-quarter net sales rose 6% year-over-year to $174.1 million on an increase in sales to two of its major customers. 
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PLYMOUTH, MN – Innovex reported second-quarter sales fell 35% quarter-on-quarter to $8.9 million.
The company cites a drop in demand for Flat Panel Display (FPD) and Actuator Flex Circuit (AFC) products that started early in the quarter and continued through the Chinese New Year holidays, as well as a shortage in materials in March.
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TAIPEI -- Compal Electronics said notebook PC shipments during the current quarter would be higher than previous company forecasts, but said the cloudy economic conditions still remain.
Compal is the world's second largest contract manufacturer of notebooks.

Compal's revised forecast calls for a sequential bounce of 15-20% in shipments for the June quarter, up from previous guidance of 15% in March. That translates to 7.25 to 7.56 million units.

The company reiterated its unit shipments target for 2009, saying business demand for PCs hasn't yet recovered.

NEWTON, MA -- Revenue from sales of automotive electronics will fall 14.5% this year before rebounding sharply in 2010, according to new research.

After falling, in dollar terms, 3% to $148 billion, 2009 sales are expected to be far worse, with the market plunging 14.5% to $126 billion.

However, says research firm Strategy Analytics, the underlying fundamentals of the automotive electronics industry are arguably stronger than ever, with increased electronics penetration the only realistic way of meeting future environmental and safety requirements. The firm forecasts a bounceback of 14.3% in 2010.

The firm further predicts the automotive electronics market will grow to $203 billion by 2013, a dollar CAAGR of 6.5% from 2008 to 2013.

SAN JOSE – The Semiconductor Industry Association today said that proposed changes to international tax rules such as weakening the deferral of US income taxes on the earnings of foreign subsidiaries of US companies could actually encourage the transfer of manufacturing and research and design activities offshore.
“While we applaud the Administration’s goal of encouraging investment in R&D and manufacturing operations in the United States, as evidenced by its proposal to make the research credit permanent, we are very concerned that the international tax proposals would have exactly the opposite result,” said SIA president George Scalise in a statement. “Nearly all of the countries with which America competes for investment either defer taxes on foreign earnings or do not tax them at all. Changes such as weakening the deferral of such taxes would place US companies with foreign subsidiaries at a competitive disadvantage.”
SIA noted that at present, the US does not tax the income generated by offshore subsidiaries of US companies until those earnings have been paid to the parent company, usually as a cash dividend. Deferral of such taxes helps to level the playing field for US companies in the global arena.
“Semiconductors are America’s second-largest export product,” Scalise said. “When American companies compete successfully in international markets, they also expand their domestic operations and create jobs in America. There are many other, better alternatives for encouraging job-creating investments in the US. Making it more expensive for US companies to compete in foreign markets is not one of them. The tax code is very complex and should not be changed in isolation, as the Administration has proposed."
SINGAPORE -- Singapore's electronics industry expanded in April for the first in six months, the Singapore Institute of Purchasing & Materials Management said.

The nation's electronics manufacturing index was 51.6, up 2.8 points from March, the agency said. Since February, electronics index has gained 7.8 points.

A reading above 50 is considered a sign of expansion.

Electronics makes up about 33% of the city-state's manufacturing output.

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