Smartphone facial recognition parts makers lower revenue guidance
Smartphone part suppliers ams, Lumentum, and Infineon Technologies have joined the ranks of companies cautioning investors that profits from the mobile device space are slowing, despite predictions that Android devices launched in 2019 will include facial recognition.
After a quarterly profit decline of 58 percent in Q4, ams suspended its 2018 dividend payment and declined to provide a full-year earnings forecast, Reuters reports. The company provides optical sensors to Apple, and also supplies Xiaomi, and possibly Huawei, according to Reuters. Shares in ams dropped by 15 percent, after declining 75 percent last year. Apple recently warned investors that iPhone sales are slowing in China last month even as ams announced its technology for under-display 3D facial biometrics, spooking the market.
“Given a market we are seeing that is very volatile and hard to read and also demand that is smaller than we had envisaged, we see first quarter sales of $350-390 million,” Chief Executive Alexander Everke said at a news conference. Considered either the previous quarter or Q1 2018, that would be a 20 percent decrease.
Infineon lowered its revenue guidance for fiscal 2019, but still expects it to increase by 9 percent, year-over-year, according to Yahoo! Finance. The company will also invest 100 to 200 million less Euros in 2019.
Lumentum, which like ams makes Face ID components, said its Q3 revenue will be in the range of $420 million to $440 million, just below analysts forecasts of $440.9, Reuters reports. The company also predicts that Android devices with facial recognition will be launched this year.
“During calendar 2019, based on customer engagements we have today, we expect new and existing customers will announce and release additional new 3D sensing-enabled products,” Lumentum CEO Alan Lowe said in a post-earnings call.
The increase in demand for optical sensors for biometric implementation in Android devices presents a silver lining for ams.
“We do have a significantly better pipeline for the Android mobile business for the first quarter and also second quarter and the quarters to come. This is a big difference to last year,” Everke said in an investor call.
The market for infrared optical sensor components is expected to grow by 24 percent CAGR to $827 million by 2025.