Strong Financial Performance in Q3
On November 7, Ennostar reported a 16.5% gross margin for Q3, an increase of 1.2 percentage points from the previous quarter and a 7.8 percentage point year-on-year growth. The operating margin was -1.8%, a significant improvement from -4% in the previous quarter and -12.4% in the same period last year. Despite a slight loss from core operations, Ennostar benefited from non-operating contributions of NT$83 million, which helped the company achieve profitability for the quarter, posting a net profit of NT$7 million after tax, or NT$0.01 per share. For the first three quarters, the company reported a net loss of NT$762 million after tax, or NT$1.02 per share.
Chairman Peng Shuanglang’s Insights on Q3 Performance
Peng Shuanglang, Chairman and CEO of Ennostar, noted that while the third quarter did not experience the same demand as previous peak seasons, the higher proportion of high-value products and a reduction in idle production capacity contributed to an improved gross margin. Non-operating contributions also played a positive role. This marked the first profitability for Ennostar in eight consecutive quarters of losses, although the profit was modest, it held significant symbolic meaning.
Improved Profitability: A Quarter-by-Quarter Recovery
Peng further explained that since the company started facing losses earlier this year, it has improved profitability quarter by quarter, with the pace of improvement accelerating. The company hopes to continue building momentum. Currently, the overall inventory turnover days stand at 76 days, slightly higher than desired, and improving this will be a focus going forward. Additionally, Crystal Semiconductor completed restructuring in Q3, which is expected to accelerate the integration of Micro LED development.
Outlook for Q4: Strategic Adjustments for Continued Growth
Looking ahead to the end of the year, Peng Shuanglang stated that with the demand for stocking up ahead of the peak season subsiding, Q4 demand is expected to be lower than Q3. The company plans to use the less busy production season to carry out equipment maintenance and collaborate with customers on new product designs, which will enhance production capacity and prepare the company for continued growth in the coming year.
About Ennostar
Ennostar, listed on the Taiwan Stock Exchange under ticker code 3714, was founded in January 2021 through a share swap between Epistar Corporation and Longda Electronics. The company provides comprehensive optoelectronic integration solutions, focusing on the research, development, and manufacturing of optoelectronic product materials using III-V compound semiconductors. The group possesses strong integration capabilities across the LED industry’s upstream and downstream sectors, enabling it to offer customers a one-stop solution from epitaxial wafers, chips, packaging, to modules. Ennostar operates in three main fields: automotive, advanced display, and smart sensing. The company is also actively exploring high-potential and high-value areas, aiming to advance towards high-added-value applications.

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