Due to the slowdown of the cargo pulling capacity of the mainland's downstream system customers, the optical communications manufacturers' operating performance in 2016 fell from the end of the first quarter. Due to the slow destocking of orders and the full tightening of orders, the expected peak season effect was also frustrated, despite the recent industry outbreak. The worst situation has passed, but the industry pointed out that the opportunity for obvious improvement in the fourth quarter is not large, and the visibility of orders is not high. The first season of previous years coincides with the off-season of the traditional Chinese New Year. The market for optical communication is limited, but Some high-end products are expected to accelerate, and will be expected to become a new kinetic energy to drive operations in 2017.
Optical communication operators pointed out that as the demand for global network communication continues to rise, applications such as e-commerce and Internet of Things are booming, and the demand for optical communication market is still very prosperous, especially for large data center construction and telecom equipment upgrades. However, many of Taiwan's optical communication industry's main products focus on applications such as the mainland family and personal broadband market. Due to the continuous production capacity of local optical communication manufacturers, Taiwanese factories are facing severe competition tests.
On the other hand, in the past, the mainland government actively promoted policies such as FTTH, and telecom operators also introduced subsidies in large quantities. However, today's peak demand for construction is about to face saturation, and the supply of GPON in the industry is oversupply, which has impacted the decline in product prices, making optical communication manufacturers In March-April 2016, the high point reversed. Due to the double impact of the decline in factory utilization rate and customer bargaining, some operators faced two consecutive quarters of losses, and the September-October revenues also set new lows.
It is worth noting that the optical communication epitaxial giant Lian Yaguang recently pointed out that the worst situation will be expected, and the market will re-expect the good news of the fourth quarter industry. Lian Yaguang said that since the customer inventory has reached a very low level, mainland and Taiwan customers have begun to place orders. As for the high-end 10G PON orders, shipments will start in small quantities in December. It is expected that the proportion of products in 2016 will be only single digits. However, it is expected to double in 2017, and the shipment momentum will be significantly enlarged from the second quarter. It is estimated that the annual proportion will be more than 20%, and the unit price of 10G PON products will be higher, and it is expected to become stable in 2017. One of the main kinetic energy.
On the other hand, the shipments of Dawning products supplied by Lian Ya to major US customers will also rebound from the third quarter. It is expected that the first half of 2017 is expected to join new customers, which is about 26% compared with Dawning. It is expected to increase steadily to more than 35% in 2017. However, the market estimates that although the revenue of Lianya will be expected to rebound from October to December, the overall fourth quarter will still be the bottom of the year, while the shipment of new specifications in 2017 will increase, but the original GPON shipments will continue. Whether the decline or the new kinetic energy can support the growth of the overall camp sports remains to be seen.
The downstream packaging factory is also dragged down by the oversupply of FTTx. The EPS of 2.24 in the third quarter has become the new low level of the recent 6 quarters. However, the high-end product shipment effect of the company has been fermented from the end of the year, such as the supply of long-distance fiber products. Shipments of 10G products are slowly increasing, and 10G EML external laser products are also expected to benefit from high-speed communication transmission demand, due to the relatively dispersed proportion of joint products, and high-speed network customers have high market share. In 2017, high-end products and new laser applications will be expected to strengthen the company's competitiveness.
The optical communication module factory Zhongda and other optical communication plants have different operating trends, mainly because their two main products are 4G/LTE optical transceiver modules and data center optical transceiver modules, which are actively deployed in North America, Japan and the mainland. 4G/LTE telecom construction and data center construction, including North America's four major Internet service providers Google, Amazon, Microsoft and Facebook have announced the expansion of data center capacity, Jones Day is optimistic about the growth of the fourth quarter results And is expected to continue until the first quarter of 2017.
Compared with the industry's current low order visibility, Jones Day said that the current US customers' visibility can be as long as six months, and the new generation of 100G optical transceiver modules will enter mass production in the first half of 2017 and will be operated in 2017. Eat a reassurance, and optimistic about the future end customers will skip the stage of 40G products, it is expected that 100G optical transceiver modules will grow 10 times in 5 years.
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