July 23, 2018 / 8:56 PM / 4 months ago

Chipmaker AMS shrugs off second quarter loss with rise in new orders

VIENNA (Reuters) - Austrian chipmaker AMS said new orders for its sensors used in face recognition will lift growth in the second half of the year, sending its shares higher and brushing aside a widely expected second-quarter operating loss.

AMS, which provides Apple with sensors used in the iPhone X face-recognition feature, said it expects “strong sequential revenue and profitability growth in the third quarter as high volume ramp-ups in consumer optical sensing have started.”

Swiss-listed AMS shares gained as much as 13 percent in early trade on Tuesday, topping the STOXX 600 and lifting other chipmakers such as STMicroelectronics and Dialog Semiconductor.

The company reported an operating loss of $48.6 million for the three months to end-June after a profit of $1.6 million the year before.

Revenue came in at $252.8 million, slightly above the upper end of its April forecast. Back then, the Swiss-quoted firm had to lower its second-quarter outlook due to a “major customer’s” delay in finalizing product plans, forcing it to wait and let capacity go unused.

Apple, which contributes an estimated 40 percent of AMS revenue, reportedly asked suppliers to make around 20 percent fewer components for the three new iPhones it plans to launch in 2018.

To secure growth, AMS aims to diversify and establish an Android customer base. It has already agreed a deal with Chinese smartphone maker Xiaomi to provide Xiaomi’s face recognition system with semiconductor laser diodes, so-called VCSEL arrays, ambient light sensors and a proximity detection module for some of its phones.

AMS said it started a new cooperation with RGB camera pioneer OmniVision, acquired image processing specialist ixellence, invested in 3D software specialist Bellus3D and will cooperate with Taiwan-based VCSEL vendor HLJ to strengthen its 3D sensing features. HLJ said it will establish a dedicated chip process manufacturing line for AMS at HLJ Taiwan.

Reporting by Kirsti Knolle, editing by Louise Heavens

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