Tower Semiconductor's Q4 revenue drops on softening demand for auto chips

Tower Semiconductor

14/02/2024 14:07

Feb 14 (Reuters) - Israel-based contract chipmaker Tower
Semiconductor  TSEM.O  posted a decline in its fourth-quarter
revenue on Wednesday, hurt by uncertainty in demand from the
automotive sector.
    Various chipmakers in their latest quarterly earnings have
signaled the beginning of a supply glut in the automotive
sector, that is likely to weigh on demand for companies such as
Tower Semiconductor.
    European chipmaker STMicroelectronics  STMPA.PA  also
forecast a more than 15% drop in its first-quarter revenue in
January, due to softer automotive demand.
    Tower Semiconductor, which makes analog and mixed-signal
chips used mainly in automotives, reported revenue of $351.7
million for the three months ended Dec. 31, down more than 12%
year-on-year.
    The company will phase out certain lower margin products, it
said without providing further details.
    The company also said both its facilities in Hokuriku, Japan
saw tools damage and some "work in progress" being hit as well
as a halt in operations, in the aftermath of an earthquake on
Jan. 1. Both factories have since returned to full operations,
it added.
    The company forecast its first-quarter revenue at $325
million, with an upward or downward range of 5%.
    It posted adjusted profit of 55 cents per share for the
fourth quarter. Four analysts polled by LSEG pegged earnings at
52 cents per share.

 (Reporting by Arsheeya Bajwa in Bengaluru; Editing by Shilpi
Majumdar)
 ((ArsheeyaSingh.Bajwa@thomsonreuters.com; +91 8510015800;))