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Integrated Micro-Electronics, Inc. (IMI), a global leader in electronics manufacturing services, announced its financial results for the first nine months of 2024.
IMI group year-to-date revenues as of September 2024 totaled US$841 million with US$758 million generated from its core businesses which navigated soft market conditions leading to a 9% decline in core sales year-on-year. The automotive market’s continued uncertainty, coupled with industrial customers’ rightsizing of inventory levels has led to reduced ordering patterns and pushouts of new product ramp-ups. These have resulted in lower utilization across multiple IMI sites, affecting profitability for the company. IMI consolidated gross margin for the first 3 quarters sits at 8.2%, marking a 63 bps decline against the same period last year. The group reported a net loss of US$9.2 million for the period which includes restructuring expenses and other non-operational one-offs. IMI core businesses have remained profitable for the year, generating US$4.3 million of net income excluding one-offs over the first 9 months of 2024.
VIA Optronics, in which IMI holds a 50% stake, is currently navigating substantial challenges in its business environment. As of September 2024, VIA Optronics reported revenues of $83 million, reflecting a 37% decline compared to last year. This downturn is primarily attributed to reductions in its laptop business, loss of orders from certain automotive customers as well as bankruptcy of another customer in the mobility camera segment. To adapt to these shifting market dynamics, VIA is implementing a series of restructuring initiatives aimed at realigning costs with current market conditions. These efforts include rightsizing overhead expenses, delisting from the NYSE, deregistration from the SEC, and scaling down the company’s overall footprint. Additionally, the company’s main manufacturing facility in Suzhou is undergoing a modernization program aimed at driving efficiency and reducing costs.
IMI CEO Louis Hughes remarked, “We are navigating the turbulent waters of the electronics market this year with both agility and decisiveness. While securing order demand remains a challenge, we have managed to mitigate the impact of the headwinds we face. Through targeted rightsizing initiatives, we have been able to reduce core fixed overhead and SG&A expenses which will result in approximately a US$25 million annualized reduction for the year. By operating more efficiently with a flatter, leaner support structure, we are positioning ourselves to enhance profitability as customer ordering patterns normalize. Furthermore, we are increasingly more selective of the projects we pursue, focusing on businesses that align with our core competencies. IMI is actively exploring all opportunities to address the issues we face from non-core activities. Our prolific sales team is also actively looking to grow our industrial segment and bring better balance to the portfolio concentration within our business.”
