WT Microelectronics Overview
WT Microelectronics is the world's largest semiconductor component distributor by revenue. In fiscal 2025 it recorded revenue of NT$1,177.9 billion (about US$37.8 billion), ahead of WPG Holdings, Arrow Electronics and Avnet. It franchises the products of more than 400 semiconductor suppliers and serves more than 20,000 customers. Since buying Future Electronics for an enterprise value of US$3.8 billion in 2024, it has combined two models. One is a high-volume Asian demand-creation and fulfilment business tied to the AI server, networking and consumer supply chains. The other is a higher-margin, broad-line Western business serving industrial, automotive and mass-market customers. The economics are thin-margin and capital-intensive: gross margin was about 4% and operating margin about 1.8% in 2025. Returns come from working-capital turns and operating leverage. In 2026 the AI data-centre build-out has pushed quarterly revenue to roughly NT$590–600 billion. Annualised ROE rose above 30% in the second quarter. The share base has also been expanded twice through global depositary share issues.
WT Microelectronics Co., Ltd. is the Taiwan-listed semiconductor component distributor and supply-chain service provider that operates in the global semiconductor component distribution services market. It is not a wafer-fab operator or a fab-infrastructure supplier. It sits in the semiconductor supply chain between chip vendors and electronics manufacturers. It buys, stocks, finances, ships and technically supports chips and other electronic components for OEMs, ODMs and EMS providers. The entity profiled here is the parent listed on the Taiwan Stock Exchange under code 3036, including its wholly owned subsidiary Future Electronics Inc. (Canada), which it acquired in 2024.
What the company does. WT Microelectronics is a franchised distributor of active semiconductors and, increasingly, passive components. The company describes its role as a liaison that bridges upstream semiconductor partners and downstream customers. It says it helps vendors shape product marketing strategy and helps customers shorten R&D pipelines. Its value-added services fall into four categories:
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professional supply-chain management
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value-added technical support
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exploring component application opportunities
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facilitating product development timelines
Company's own description (2025/26 corporate profile). WT says it serves as distribution partner for more than 400 leading semiconductor suppliers and more than 20,000 customers. Its products are used in:
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automotive electronics
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industrial and instrumentation
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communication
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data centre and server
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consumer electronics
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PC and peripherals
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mobile phones
The company reported 2025 annual sales of NT$1.1779 trillion. Its filings describe the group as handling more than 220,000 component types and shipping tens of billions of chips a year to a customer base of more than 25,000. That customer figure includes Future Electronics' broad-line customers.
Independent characterisation. WT is a working-capital and logistics platform that makes money on volume:
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It takes title to inventory.
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It extends credit to customers.
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It carries foreign-currency (mainly US dollar) payables to suppliers.
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It earns a gross spread of roughly 3.4%–4.0%.
Management has explained that the model mostly runs on a fixed percentage margin. Component price increases, such as the 2026 rises in memory, power-management ICs and passives, therefore enlarge revenue and absolute gross profit without changing percentage margins.
The business has two distinct engines:
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Asian demand-creation and fulfilment (legacy WT plus Excelpoint). This engine serves Taiwanese and Chinese ODMs, server and networking assemblers, handset makers and PC makers. It is very high volume, has low gross margin and low working-capital days, and is currently dominated by AI data-centre and optical-communication products.
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Western broad-line distribution (Future Electronics). This engine serves industrial, automotive, medical, aerospace and mass-market customers in the Americas and EMEA. It has higher gross margin, higher inventory and receivable intensity, and engineering-led design-in services.
Revenue model. Product resale makes up essentially all revenue. Service income such as logistics, engineering design-in and supply-chain programmes is embedded in product margins rather than billed separately. There is no subscription or licensing revenue of significance.
Value-chain position. WT sits between semiconductor design houses and integrated device manufacturers upstream, and ODMs, OEMs and EMS providers downstream. It does not manufacture chips and has no wafer-fab operations. Its fixed assets are small: property, plant and equipment was NT$6.5 billion at end-2025 against total assets of NT$527.6 billion.
Customer types. Customers are ODMs and EMS providers, especially Taiwanese AI server and networking assemblers. Other customer groups include branded OEMs in PC, handset and consumer electronics, industrial and automotive tier-1 suppliers, and mass-market engineering customers in the Americas and EMEA served through Future.
End-market mix. In the second quarter of 2026, data centre and server accounted for 59.2% of revenue. Revenue tied to data centre, communications, industrial and automotive applications accounted for 83.6%. Consumer electronics and PC together had fallen to 16.4%. Data centre plus communications made up more than 70% of first-half 2026 revenue, compared with 54% for full-year 2025.
Strategy
Stated strategic themes
WT's stated strategy rests on four themes:
Partnership: Treat vendors and customers as partners in mutual prosperity.
Core-business focus: Concentrate on distribution and create value in the supply chain that others cannot easily replace.
Excellence and scale: Deepen the global footprint built through the Future acquisition.
Capital efficiency: Raise ROE through operating leverage and working-capital discipline.
Current management messaging adds several points:
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Pursue leadership in AI-related semiconductor distribution.
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Capture the recovery in industrial and automotive markets in Europe and the US.
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Strengthen corporate fundamentals while optimising the global footprint and operational efficiency.
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Offer more comprehensive and flexible solutions to expand market share and grow profit sustainably.
Management argues that organic growth alone can sustain long-term competitiveness. Its reasoning is that distributors have kept their share as the semiconductor market expands from US$1 trillion towards US$2 trillion.
Initiatives in the last 24 months
| Initiative | Date | Description and intent |
|---|---|---|
| Future Electronics integration | From April 2024 | Combining two complementary models under dual headquarters. Future grew more than 40% YoY in Q1 and Q2 2026. |
| Full ownership of WT Semiconductor / Excelpoint | December 2024 | Buying the founder's 20% to speed integration of the Singapore subsidiary |
| Passive-component expansion via Nichidenbo | July 2025 to May 2026 | Share swap lifted WT's stake from 14.58% to about 36%; WT's chairman now chairs Nichidenbo. The aim is to broaden the line card from active ICs into passives. |
| AI application-engineering investment | Ongoing | Concentrated in power-management ICs and optical communications |
| Overseas funding programme | November 2025 and September 2026 | About US$1.67 billion raised through GDSs and CBs in total, mainly to fund foreign-currency component purchases and repay foreign-currency bank loans |
| NT$43 billion syndicated loan | Completed by August 2026 | Oversubscribed more than two times. Supports working-capital growth. |
| Net-zero 2050 commitment | From August 2023 | Group-level decarbonisation pathway |
Future Electronics integration: Date: From April 2024; Description and intent: Combining two complementary models under dual headquarters. Future grew more than 40% YoY in Q1 and Q2 2026.
Full ownership of WT Semiconductor / Excelpoint: Date: December 2024; Description and intent: Buying the founder's 20% to speed integration of the Singapore subsidiary
Passive-component expansion via Nichidenbo: Date: July 2025 to May 2026; Description and intent: Share swap lifted WT's stake from 14.58% to about 36%; WT's chairman now chairs Nichidenbo. The aim is to broaden the line card from active ICs into passives.
AI application-engineering investment: Date: Ongoing; Description and intent: Concentrated in power-management ICs and optical communications
Overseas funding programme: Date: November 2025 and September 2026; Description and intent: About US$1.67 billion raised through GDSs and CBs in total, mainly to fund foreign-currency component purchases and repay foreign-currency bank loans
NT$43 billion syndicated loan: Date: Completed by August 2026; Description and intent: Oversubscribed more than two times. Supports working-capital growth.
Net-zero 2050 commitment: Date: From August 2023; Description and intent: Group-level decarbonisation pathway
Guidance and medium-term view
| Item | Q3 2026 guidance midpoint |
|---|---|
| Revenue (TWD bn) | 592 |
| Gross margin (%) | 3.59 |
| Operating profit (TWD bn) | 14.0 |
| Operating margin (%) | 2.37 |
| Net profit to parent (TWD bn) | 10.2 |
| EPS (TWD) | 8.03 |
| FX assumption (NT$ per US$) | 32.2 |
| Net financial cost (TWD bn) | 1.7–1.8 |
Revenue (TWD bn): Q3 2026 guidance midpoint: 592
Gross margin (%): Q3 2026 guidance midpoint: 3.59
Operating profit (TWD bn): Q3 2026 guidance midpoint: 14.0
Operating margin (%): Q3 2026 guidance midpoint: 2.37
Net profit to parent (TWD bn): Q3 2026 guidance midpoint: 10.2
EPS (TWD): Q3 2026 guidance midpoint: 8.03
FX assumption (NT$ per US$): Q3 2026 guidance midpoint: 32.2
Net financial cost (TWD bn): Q3 2026 guidance midpoint: 1.7–1.8
Outlook. Management expects demand to keep strengthening through the second half of 2026 and into 2027. It described expected fourth-quarter data-centre shipments as a "considerable increase" and said it was very positive on 2027. In August 2026 WT raised its own forecasts for the semiconductor market:
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2026 global semiconductor market growth to 92% (from 64%)
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2025–2029 market CAGR to 25.9%
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2029 market size to about US$2 trillion
Formal multi-year financial targets for revenue or ROE are not publicly disclosed.
Products & Services
WT does not make products. Its "portfolio" is its line card of franchised suppliers and the services wrapped around it. The group carries more than 220,000 component types from more than 400 suppliers.
Active semiconductor product families distributed
Passive components. WT is moving from active ICs into passives through its associate Nichidenbo, a distributor of MLCCs and other passive components. Nichidenbo said in August 2026 that MLCC lead times had stretched to about 36 weeks because of AI-server and ASIC demand.
Value-added service offerings
Pricing model. Components are resold at a negotiated mark-up over supplier cost. Management describes this as largely a fixed-margin model. Supplier price protection and ship-and-debit programmes are standard industry practice.
Notable portfolio change. WT stopped carrying Texas Instruments products in late 2019, at the same time as WPG.
Product Portfolio
| Product family | Description and typical use | Main demand drivers |
|---|---|---|
Logic ICs | General and application-specific digital logic | Servers, networking, consumer |
Mixed-signal and analog ICs | Data converters, amplifiers, interface | Industrial, automotive, communications |
Power-management ICs | Voltage regulators and power stages for boards and racks. WT says it has invested heavily in application engineering for these. | AI servers, data-centre power delivery |
ASICs and programmable logic | Custom and FPGA devices | Networking, AI accelerators, industrial |
High-speed interface and driver ICs | USB, PCI Express and SATA controllers and similar high-speed interface chips (for example from ASMedia, for which WT is a distributor) | PCs, servers, storage |
Signal-processing and conversion ICs | DSPs and conversion devices | Communications, audio and video |
Microprocessors and microcontrollers | MPUs and MCUs | Industrial, automotive, IoT |
Memory | DRAM, NAND and NOR | Servers, PCs, handsets |
Image sensors | CMOS image sensors | Handsets, automotive, security |
Discrete devices | Diodes, transistors, power discretes | Power, automotive, industrial |
Optical-communication components | Components for AI-cluster optical interconnect. WT says it has invested heavily in application engineering for these. | AI data-centre networking |
| Service | Description | Target customer |
|---|---|---|
Supply-chain management | Inventory planning, buffer stock, consignment and just-in-time programmes, global logistics | ODMs, EMS providers, OEMs |
Financial-flow services | Customer credit and supplier payment across currencies, absorbing working capital on both sides | ODMs, OEMs |
Information-flow services | Demand forecasting, order and backlog management, real-time inventory visibility (Future runs one global IT platform) | All customers |
Technical support and design-in | Field application engineers and reference designs that move components into customer products | OEMs, design houses |
Engineering design services | Custom engineering and design support, a core Future Electronics offering | Industrial, automotive, medical OEMs |
Application development | Identifying new application opportunities for suppliers' parts and co-defining go-to-market strategy | Semiconductor suppliers |
Financial Narrative
All figures are consolidated, under Taiwan-IFRS, in NT$ millions unless otherwise stated, for fiscal years ending 31 December. Source: audited annual financial statements; the FY2025 statements were filed 14 April 2026.
Income statement
Revenue grew at a compound annual rate of about 27.4% from FY2021 to FY2025. The FY2024 step-up of 61% reflects nine months of Future Electronics consolidation.
Margins
Commentary. Gross margin bottomed at 3.10% in FY2023, a destocking year in consumer and PC markets. It rose to 3.92% in FY2024 and 4.04% in FY2025 because Future's Western broad-line business carries structurally higher gross margins. That gain came with a much larger cost base: the opex ratio rose from 1.4% to 2.3%. Operating margin in FY2025 (1.77%) was therefore still below the FY2021 peak (2.36%).
The 2026 pattern is the reverse. AI data-centre volume dilutes gross margin: second-quarter 2026 gross margin was 3.41% against 4.32% a year earlier. But the opex ratio collapsed to 1.21% from 2.53%, so operating margin rose to about 2.2%. Management guided gross margin back up to 3.59% and operating margin to about 2.37% for the third quarter of 2026, helped by recovery in industrial, automotive and Future.
Balance sheet (31 December)
Mid-2026 position (30 June 2026).
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Total assets had jumped to NT$812.7 billion as the AI volume ramp swelled both sides of the balance sheet: receivables were NT$353.9 billion, inventory NT$318.6 billion and payables NT$557.1 billion.
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Total debt was NT$66.4 billion against cash of NT$38.1 billion, for net debt of NT$28.3 billion.
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Equity was NT$124.7 billion.
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Management reported a net debt ratio of 22% (down from 49% a quarter earlier) and net leverage of about 0.8 times.
Cash flow
Commentary. Cash flow in distribution is counter-cyclical:
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In up-cycles (2021–2022) working-capital build absorbs cash, and operating cash flow turned negative.
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In the 2023 slowdown inventory was released and payables extended, producing NT$41 billion of operating cash flow.
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In 2025 inventory rose by about NT$99 billion to support AI demand, which compressed operating cash flow to NT$17.6 billion even as profit hit a record.
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Trailing operating cash flow to June 2026 recovered to NT$25.3 billion, because supplier payables grew faster than receivables and inventory.
Capex rose in 2025 to NT$1.7 billion, largely related to buildings, but stays immaterial against the size of the business.
Ratios (computed on year-end balances)
Trends, inflections and drivers.
Returns: ROE fell to a trough in FY2023 because of the cyclical downturn and acquisition-related equity raising. It recovered to 11.4% in FY2025 and then rose steeply in 2026: annualised ROE was 24.3% in Q1 2026 and 32.8% in Q2 2026, a record.
Interest coverage: Coverage weakened from 23 times in FY2021 to 3.6 times in FY2023 as rates rose and Future's acquisition debt was taken on, then recovered to 6.4 times. Trailing coverage reached about 9.6 times by mid-2026.
Working capital: The cash conversion cycle tightened to about 35 days at end-2025 because supplier payable days lengthened. Management reported that its own working-capital turnover measure fell to a record low of 18 days in Q2 2026.
Trailing twelve months to June 2026: Revenue was NT$1,756 billion (+70%), gross profit NT$62.3 billion, operating income NT$34.6 billion, EBITDA NT$35.4 billion and net income to common NT$24.4 billion. TTM EPS was NT$19.47 and ROIC about 17%.
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Platform Details
| Platform | What it contains | Geographic focus |
|---|---|---|
WT Microelectronics (legacy) | Franchised distribution, field application engineering and supply-chain services for ODM, OEM and EMS customers | Taiwan, mainland China, Asia Pacific |
WT Semiconductor / Excelpoint | B2B component distribution, engineering design services and supply-chain management. R&D centres in Singapore, China and Vietnam | Southeast Asia, China, India |
Future Electronics | Broad-line distribution, engineering design services, global supply-chain programmes and a single global IT and inventory system | Americas, EMEA, Asia (44 countries, 159 offices at acquisition) |
Nichidenbo (associate, about 36%) | Passive-component distribution (MLCCs and similar) | Taiwan, Greater China |
Segment Revenue
| Application | Share of revenue, FY2025 (%) | Share of revenue, Q2 2026 (%) | YoY growth, Q2 2026 (%) |
|---|---|---|---|
Data centre and server | — | 59.2 | 274 |
Communications | — | — | 94 |
Data centre, server and communications combined | 54 | above 70 (first half 2026) | — |
Data centre, communications, industrial and automotive combined | — | 83.6 | — |
Consumer electronics and PC combined | — | 16.4 | — |
“—” = not publicly disclosed.
Results by Segment and Per-Share Data
| Metric | Q1 2025 | Q2 2025 | Q3 2025 | Q4 2025 | Q1 2026 | Q2 2026 | Q3 2026 |
|---|---|---|---|---|---|---|---|
Revenue (TWD Mn) | 247,424 | 259,503 | 328,934 | 342,100 | 494,300 | 590,700 | 597,300 |
Operating profit (TWD Mn) | 4,570 | 4,660 | 5,660 | 5,991 | 9,944 | 13,000 | 14,000 |
Net profit to parent (TWD Mn) | 2,707 | 2,830 | 3,816 | 4,191 | 7,009 | 9,713 | 10,200 |
EPS (TWD) | 2.40 | 2.28 | 3.40 | 3.46 | 5.32 | 7.68 | 8.03 |
Income Statement and Margin Analysis (%)
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Revenue (TWD Mn) | 447,896 | 571,197 | 594,519 | 959,432 | 1,177,949 |
Revenue growth (%) | 26.83 | 27.53 | 4.08 | 61.38 | 22.78 |
Gross profit (TWD Mn) | 16,987 | 19,832 | 18,406 | 37,602 | 47,624 |
SG&A (TWD Mn) | 5,818 | 7,394 | 9,443 | 21,389 | 25,291 |
R&D expense (TWD Mn) | 609 | 655 | 755 | 851 | 810 |
Operating income (TWD Mn) | 10,557 | 11,783 | 8,200 | 15,264 | 20,882 |
Interest expense (TWD Mn) | 453 | 1,437 | 2,254 | 3,415 | 3,261 |
Pre-tax income (TWD Mn) | 10,180 | 9,911 | 5,195 | 11,835 | 17,399 |
Income tax (TWD Mn) | 2,325 | 2,311 | 1,217 | 2,629 | 3,833 |
Net income attributable to parent (TWD Mn) | 7,923 | 7,631 | 4,012 | 9,112 | 13,544 |
Net income to common after preferred dividends (TWD Mn) | 7,866 | 7,361 | 3,742 | 8,842 | 13,274 |
EPS basic (TWD) | 9.75 | 8.53 | 4.17 | 8.05 | 11.50 |
Cash dividend per share (TWD, by year of record) | 5.5 | 4.3 | 1.8 | 6.0 | 7.8 |
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View Subscription PlansMargin Analysis (%)
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Gross margin (%) | 3.79 | 3.47 | 3.10 | 3.92 | 4.04 |
Operating margin (%) | 2.36 | 2.06 | 1.38 | 1.59 | 1.77 |
Pre-tax margin (%) | 2.27 | 1.74 | 0.87 | 1.23 | 1.48 |
Net margin to common (%) | 1.76 | 1.29 | 0.63 | 0.92 | 1.13 |
Opex-to-revenue (%) | 1.44 | 1.41 | 1.72 | 2.33 | 2.27 |
Balance Sheet and Per-Share Data
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Total assets (TWD Mn) | 173,349 | 200,202 | 265,185 | 412,490 | 527,560 |
Cash and short-term investments (TWD Mn) | 4,716 | 5,452 | 24,442 | 40,705 | 28,885 |
Accounts receivable (TWD Mn) | 76,391 | 85,777 | 114,348 | 143,442 | 171,896 |
Inventory (TWD Mn) | 66,524 | 90,547 | 95,715 | 160,928 | 259,760 |
Accounts payable (TWD Mn) | 69,809 | 77,997 | 147,955 | 186,741 | 317,278 |
Short-term debt incl. current LTD (TWD Mn) | 35,624 | 39,390 | 20,260 | 37,085 | 35,300 |
Long-term debt (TWD Mn) | 7,750 | 17,786 | 12,644 | 63,366 | 34,383 |
Total debt incl. leases (TWD Mn) | 43,814 | 57,761 | 33,623 | 102,412 | 71,637 |
Net debt (TWD Mn) | 39,099 | 52,308 | 9,181 | 61,707 | 42,751 |
Goodwill and intangibles (TWD Mn) | 1,973 | 3,372 | 3,340 | 40,847 | 38,828 |
Total equity (TWD Mn) | 53,860 | 54,974 | 71,946 | 103,863 | 117,938 |
Working capital (TWD Mn) | 38,554 | 58,833 | 60,858 | 111,651 | 94,101 |
Book value per share (TWD) | 65.29 | 59.71 | 78.56 | 90.88 | 91.92 |
Cash Flow and Margin Analysis (%)
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Operating cash flow (TWD Mn) | -12,980 | -6,039 | 41,028 | 42,428 | 17,606 |
Capital expenditure (TWD Mn) | -171 | -310 | -228 | -249 | -1,668 |
Free cash flow (TWD Mn) | -13,151 | -6,349 | 40,800 | 42,179 | 15,938 |
FCF margin (%) | -2.94 | -1.11 | 6.86 | 4.40 | 1.35 |
Returns & Leverage Ratios (%) and Financial Ratios (x)
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
ROE on year-end common equity (%) | 15.0 | 14.0 | 5.4 | 8.7 | 11.4 |
ROA (%) | 4.57 | 3.81 | 1.51 | 2.21 | 2.57 |
Current ratio (x) | 1.35 | 1.47 | 1.34 | 1.46 | 1.25 |
Total debt / equity (x) | 0.81 | 1.05 | 0.47 | 0.99 | 0.61 |
Net debt / operating income (x) | 3.70 | 4.44 | 1.12 | 4.04 | 2.05 |
Interest coverage, operating income / interest (x) | 23.3 | 8.2 | 3.6 | 4.5 | 6.4 |
Asset turnover, revenue / year-end assets (x) | 2.58 | 2.85 | 2.24 | 2.33 | 2.23 |
Days sales outstanding | 62.3 | 54.8 | 70.2 | 54.6 | 53.3 |
Days inventory outstanding | 56.3 | 59.9 | 60.6 | 63.7 | 83.9 |
Days payables outstanding | 59.1 | 51.6 | 93.7 | 73.9 | 102.5 |
Cash conversion cycle (days) | 59.5 | 63.1 | 37.1 | 44.4 | 34.7 |
Revenue by Region
| Region (TWD Mn) | FY2023 | FY2024 | FY2025 |
|---|---|---|---|
United States | 109,440 | 332,847 | 428,027 |
Taiwan | 262,587 | 281,511 | 302,733 |
Mainland China | 151,257 | 219,129 | 280,044 |
Other regions | 71,235 | 125,945 | 167,144 |
Total | 594,519 | 959,432 | 1,177,949 |
Region growth (%)
| Region growth (%) | FY2024 | FY2025 |
|---|---|---|
United States | 204.1 | 28.6 |
Taiwan | 7.2 | 7.5 |
Mainland China | 44.9 | 27.8 |
Other regions | 76.8 | 32.7 |
Region share of revenue (%)
| Region share of revenue (%) | FY2023 | FY2024 | FY2025 |
|---|---|---|---|
United States | 18.4 | 34.7 | 36.3 |
Taiwan | 44.2 | 29.3 | 25.7 |
Mainland China | 25.4 | 22.8 | 23.8 |
Other regions | 12.0 | 13.1 | 14.2 |
Share Price History
| Date | Price | Context |
|---|---|---|
November 2019 | 36.1 | Before WPG tender |
January 2024 | 117.5 | After rights-issue subscription news |
August 2025 | about 126–130 | Mid-2025 range |
October 2025 | 136.5 | Before the November 2025 GDS issue |
22 May 2026 | 289 | Year-to-date high zone |
1 September 2026 | 196 | GDS pricing day close |
22 October 2026 | 213 | Recent level |
Valuation Multiples
| Multiple | WT Microelectronics |
|---|---|
Trailing P/E (x) | 10.97 |
Forward P/E (x) | 7.72 |
EV / EBITDA (x) | 8.15 |
EV / Sales (x) | 0.17 |
P/B (x) | 2.18 |
P/TBV (x) | 3.18 |
Dividend yield (%) | 3.65 |
Per-Share Data
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Cash dividend per share (TWD) | 5.5 | 4.3 | 1.8 | 6.0 | 7.8 |
Capital Instruments
| Instrument | Size | Terms |
|---|---|---|
Convertible bonds (November 2025) | US$350 m | Zero coupon, 1.125% yield to maturity, two-year tenor (about November 2027), NT$-linked and US$-settled; conversion NT$181.7 |
Convertible bonds (September 2026) | US$500 m | Zero coupon, 0% yield, nine-month tenor (June 2027); conversion NT$224.54 |
Syndicated loan (2026) | NT$43 bn | Oversubscribed more than two times |
Syndicated loan (Future acquisition, 2023) | US$1.9 bn | DBS-led |
Short-term debt (30 June 2026) | NT$53.1 bn | Working-capital lines |
Long-term debt (30 June 2026) | NT$11.3 bn | Term borrowings |
Analyst Conclusions
Management guidance.
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Q3 2026 midpoints: revenue NT$592 bn, gross margin 3.59%, operating profit NT$14 bn, net profit NT$10.2 bn, EPS NT$8.03. Actual Q3 sales of NT$597.3 bn came in above the revenue midpoint.
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Q4 2026: data-centre shipments expected to rise considerably, with the second half stronger than the first.
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2027: management describes the outlook as very positive.
Consensus. Analysts expect three-year revenue growth of about 48% and EPS growth of about 52%. Forward P/E is about 7.7 times.
Bull case
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AI runway. Data-centre revenue grew 274% in Q2 2026, and management has raised its 2029 market estimate to US$2 trillion. A stronger fourth quarter plus 2027 growth could keep quarterly revenue at or above NT$600 bn.
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Margin mix recovery. Industrial, automotive and Future are recovering (Future up more than 40%, book-to-bill above 1). Guided gross margin is rising from 3.41% to 3.59% as Western broad-line volume adds higher-margin revenue on a fixed cost base.
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Valuation. The stock trades at about 11 times trailing and under 8 times forward earnings, with ROE above 30%. The average price target implies more than 40% upside, and management publicly says the shares are undervalued.
Bear case
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Peak-cycle risk. With about 59% of revenue in data centres and Q3 revenue flat on shipment scheduling, any pause in hyperscaler capex would hit a business where every point of volume matters at a 1%–2% net margin.
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Dilution and funding. Shares rose about 12% in a year before the 75-million-share September GDS. More than US$850 m of CBs are convertible at NT$181.7 and NT$224.54. Working capital keeps rising: receivables were NT$354 bn at June 2026.
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Interest and FX. Net financial cost was guided at NT$1.7–1.8 bn a quarter. Borrowing is mainly in US dollars, so any rise in US rates feeds straight into the cost base.
Key catalysts and monitorables (next 12 months)
| Catalyst / monitorable | Timing | What to watch |
|---|---|---|
| Q3 2026 results and Q4 guidance | Early November 2026 | Gross margin against the 3.59% guide; size of the Q4 data-centre ramp |
| Monthly sales releases | Around the 10th of each month | Run-rate above NT$200 bn per month |
| Future Electronics growth | Quarterly | Sustaining more than 40% YoY; Western book-to-bill |
| Consumer and PC demand | Second half 2026 | Size of any correction after first-half pull-ins |
| CB conversion and redemption | Through June and November 2027 | Dilution against cash settlement |
| Nichidenbo integration | 2026–2027 | Passive-component synergies; possible further consolidation |
| FY2026 dividend | Board resolution in early 2027 | Payout relative to record earnings |
| Tariff and export-control changes | Ongoing | US–China rules on AI and networking components |
Q3 2026 results and Q4 guidance: Timing: Early November 2026; What to watch: Gross margin against the 3.59% guide; size of the Q4 data-centre ramp
Monthly sales releases: Timing: Around the 10th of each month; What to watch: Run-rate above NT$200 bn per month
Future Electronics growth: Timing: Quarterly; What to watch: Sustaining more than 40% YoY; Western book-to-bill
Consumer and PC demand: Timing: Second half 2026; What to watch: Size of any correction after first-half pull-ins
CB conversion and redemption: Timing: Through June and November 2027; What to watch: Dilution against cash settlement
Nichidenbo integration: Timing: 2026–2027; What to watch: Passive-component synergies; possible further consolidation
FY2026 dividend: Timing: Board resolution in early 2027; What to watch: Payout relative to record earnings
Tariff and export-control changes: Timing: Ongoing; What to watch: US–China rules on AI and networking components
Analyst verdict
WT Microelectronics has changed in three years from a strong Asian distributor into the largest semiconductor distributor in the world. Revenue nearly doubled from NT$594.5 bn in FY2023 to NT$1,177.9 bn in FY2025, and the run-rate is now about NT$2.4 trillion a year. Two moves drove this: the US$3.8 bn Future Electronics acquisition, which added the Western industrial and automotive franchise, and the AI data-centre ramp, which supplies volume.
The 2026 results show the model's operating leverage clearly. Revenue more than doubled, the opex ratio fell by half, and ROE rose from about 11% to more than 30%. The core trade-off has not changed. Gross margins below 4% and net margins between 1% and 1.5% mean the business converts volume into profit only if working capital is funded cheaply and turns quickly. Management has delivered on both: working-capital days hit a record low and net gearing has fallen to 22%. It has done so partly by issuing equity: two GDS issues and two convertible bonds in ten months.
The valuation, at about 11 times trailing earnings, already prices in substantial cyclical risk. That is reasonable given that data centres make up about 59% of revenue and the Q3 2026 top line is flat. Two factors keep a pullback in AI spending from being a binary risk. The Western broad-line recovery adds higher-margin revenue, and the fixed-margin pricing model allows the company to pass on cost changes.
The investment case therefore depends on three things:
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the pace of Q4 2026 and 2027 data-centre shipments
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Future sustaining strong double-digit growth
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management keeping dilution and interest costs below the growth in earnings
Execution in 2025–2026 has been strong and the balance sheet has improved. On that record, WT warrants a constructive view, with position sizing that respects how concentrated and cyclical its exposure to AI demand has become.
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View Subscription PlansExecutive Leadership
Executive Leadership Team
| Name | Title | Education | Background |
|---|---|---|---|
Wen-Tsung (Eric) Cheng | Founder, Chairman and CEO | Industrial Engineering, Tunghai University | Has led WT since founding it in 1993. Chairman of Nichidenbo since 22 May 2026. |
Kerry Hsu | Co-founder and Senior Vice President | Land Economics, National Chengchi University | Co-founder of WT |
Rick Chang | President, Asia Pacific | China University of Science and Technology | Leads Asia Pacific operations |
Jerry Chang | President, China | EMBA, Tulane University | Leads China operations |
James Wen | Chief Marketing Officer | Tungnan University | Supplier marketing and line-card strategy |
Steve (Kuan-Nan) Lin | Chief Financial Officer | MS Electrical Engineering, University of California, Santa Barbara | Leads investor conferences and capital-markets activity |
Omar Baig | President and CEO, Future Electronics | — | Has led Future through and since the acquisition |
“—” = not publicly disclosed.
Major Shareholders
| Holder | Shares | Stake (%) |
|---|---|---|
ASMedia Technology Inc. | 188,720,421 | 14.9 |
WPG Holdings Limited | 153,087,471 | 12.1 |
Shao Yang Investment Co., Ltd. | 86,590,066 | 6.8 |
Yuanta Securities Investment Trust | 53,381,508 | 4.2 |
The Vanguard Group | 28,035,610 | 2.2 |
Wen-Tsung (Eric) Cheng | 25,507,112 | 2.0 |
BlackRock | 10,680,558 | 0.8 |
Norges Bank Investment Management | 9,743,579 | 0.8 |
Dimensional Fund Advisors | 8,498,094 | 0.7 |
Shaocheng Investment Co., Ltd. | 8,000,000 | 0.6 |
Competitive Landscape
Key Competitors
| Competitor | HQ | Positioning vs WT |
|---|---|---|
WPG Holdings (3702 TT) | Taiwan | Largest Asian rival with an overlapping Taiwan and China franchise. Also an about-12% shareholder in WT. Has a logistics and ICT services arm (LaaS). |
Arrow Electronics (NYSE: ARW) | United States | Global broad-line components plus an enterprise computing solutions segment; strongest in the Americas and EMEA |
Avnet (Nasdaq: AVT) | United States | Global components distributor plus the Farnell catalogue business; competes with Future in the West and in Asia |
TTI / Mouser (Berkshire Hathaway, private) | United States | Passives, connectors and high-service catalogue distribution |
Digi-Key (private) | United States | Catalogue and e-commerce distribution for engineers |
Macnica Holdings | Japan | Asian technical distributor with a strong design-in model |
Supreme Electronics | Taiwan | Taiwanese distributor with memory and AI-server exposure |
Edom Technology | Taiwan | Taiwanese distributor with consumer and PC exposure |
Weikeng Industrial | Taiwan | Taiwanese mid-sized distributor |
Rutronik | Germany | European broad-line distributor competing with Future in EMEA |
Peer Comparison FY2025
| Company | Fiscal year | Revenue (USD Bn) | Revenue growth (%) | Net margin (%) |
|---|---|---|---|---|
WT Microelectronics | FY2025 (December) | 37.8 | 22.8 | 1.13 |
WPG Holdings | FY2025 (December) | 32.0 (NT$999.1 bn) | 13.5 | 1.01 |
Arrow Electronics | FY2025 (December) | 30.9 | 10.0 | 1.85 |
Avnet | FY2026 (June) | 27.6 | 24.5 | 1.21 |
