A few fays ago we also reported about CMC and a possible price increase. On digitimes we can find another report about CMC.
It says the worst is over for CMC Magnetics and that the gross margins will grow to 30% next year after more than a year of downturn.
Responding to rising CD-R disc prices and orders, CMC's gross margin in August inched up to 22% from the first-half average of 20.5%, Wong said.
'Profitability is our top priority over factory utilization rates," Wong said, noting that the company now rejects low-margin orders as part of its renewed profit focus.
After raising prices by 15% in October, the company will institute another increase of 5-10% at year-end or early next year. Higher prices will further lift gross margins to 25% in the fourth quarter and to 30% next year, Wong predicted.
CMC is one of the world's largests CD-R disc maker's. However small disc manufacturers could still get in trouble.
CMC also stated that the 48x discs still accounted for 80% of its CD-R disc shipments, with the rest from 52x. They predict that for the coming fourth quarter, the ratio will reverse, with 52x discs taking 80% of shipments.
Source: digitimes
