High margin products push growth at silicon IP provider

The revenue for IP not only grew 7% quarter-over-quarter to NT$225 million but also reached a ten year high.

As to NRE, Faraday’s NRE revenue for the applications this quarter including aircraft, 5G wireless networking, industrial, multimedia and precision agriculture rode on the trend toward higher value products from last quarter.

Moreover, the contribution from niche products, IoT and cloud and industrial applications, increased significantly from last quarter and reached 50% of overall sales excluding IP in the third quarter. All these are considered results of Faraday’s strategic transition.

In addition to the continued improvement of revenue quality, the company’s gross margin also grew to 52.5% this quarter, setting a record high in the past three years. 

Looking into the fourth quarter, IP and NRE, the high margin products, are expected to see further revenue growth.

With the strategic adjustment gradually implemented, Faraday’s both business operation and internal management are well on track now.

On the product mix front, for NRE, the company grew its new projects significantly with a focus on niche applications. With a more balanced customer base, ASIC products are now positioned with high entry barrier and long life cycle.

Going forward, Faraday will continue to focus on high-value products while leveraging its strength on IP to provide total solutions to the clients.