Largan Precision Co., a supplier of smartphone camera lenses to Apple Inc., on Thursday said its earnings per share (EPS) in the third quarter of this year hit a 12-quarter high, largely following the launch of new products by a major client.
While Largan did not specify who the client was, market analysts pointed to Apple, which unveiled and started selling the latest iPhone 14 series in September.
At an investor conference, Largan said it posted NT$8.14 billion (US$1.75) in net profit, up 64.4 percent from a quarter earlier, while its EPS stood at NT$61.01, the highest level since the third quarter of 2019, when the figure hit NT$63.86.
Largan said it enjoyed NT$3.49 billion in foreign exchange profit due to a weaker Taiwan dollar against the U.S. dollar in the third quarter, when the U.S. Federal Reserve aggressively raised its key interest rates, boosting the greenback.
However, the company’s gross margin — the difference between revenue and the cost of goods sold — fell to 53.7 percent in the third quarter, down from 55.82 percent in the second quarter and 59.32 percent over the same period of last year, Largan said, adding an increase in voice coil motors (VCMs) in its product portfolio dragged down the profit margin.
During the July-September period, lenses with a resolution of 20 megapixels or more — a higher-margin product and one of Largan’s specialties — accounted for 10-20 percent of total sales, the company said.
Lenses with 10-20 megapixels accounted for 50-60 percent of Largan’s sales, 8-10 megapixel lenses made up about 10 percent, and other products, such as VCMs, contributed 30-40 percent in the three month period, the company said.
In the first nine months of this year, Largan’s net profit hit NT$18.6 billion with EPS at NT$139.37, which rose 38 percent from a year earlier and also topped the NT$139.28 for all of 2021.
Largan CEO Adam Lin (林恩平) said at the investor conference that he expects sales growth momentum in October and November to be close to that of September, when consolidated sales hit the highest level in 22 months, after growing 22.31 percent from a year earlier to NT$5.103 billion.
In addition, Largan has expanded its reach to camera lenses used in virtual reality products, with shipments of polarization-based “pancake lenses” used in VR gadgets expected to start later this year, Lin said.
Clients are expected to launch new flagship smartphone models in the first half of next year, which will need more advanced camera lenses, including periscope lenses, Lin added.
The company’s expansion plan is proceeding on schedule, and production equipment to roll out camera lenses for smartphones will be installed at a new plant in Taichung at the end of the third quarter of next year, Lin said.

Source: Focus Taiwan News Channel