Presentation Q&A

Q: How much demand growth of the diversity do you expect in the near
future?

A: We expect all LTE handsets would require a diversity circuit to achieve requirements for throughput and spectral efficiency in years to come. Furthermore, with the adoption of wireless technologies such as MIMO to increase data transmission rate, we expect growing demand for RF components.

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A: Our target of sales growth is 5 to 10% per annum in the mid-term. We think sales trend will be influenced by the timing of new smartphone's launch, therefore the demand will start to pick up from August or September and sales in 2nd half will be larger than 1st half.

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A: We think it would be possible to increase sales per unit of smartphone with LTE by 10% to 20% with the demand of components with higher value such as leading-edge FEM and PA which LTE handsets require.

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A: We are proceeding overseas production in China and Philippine for the sake of cultivating demand of emerging market and cost reduction.

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A: Murata's profitability in 12Q1 was terribly low because some sales for smartphones were pushed back, on the other hand, fixed costs rose for new products and M&A as a prior investment. However we think the profitability in 12Q2 was Murata's average level and the profit structure, the profit greatly rises once sales increase has not changed.

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A: We target 10 to 15% for operating margin.

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A: The trend would be the ultra-compact and high capacity. Furthermore, we expect the growing market of ultra-low profile MLCCs built-in substrates.

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A: Murata's switch IC is made of GaAs. We currently use it for some products such as Wi-Fi modules, however we offer higher value modules by raising the ratio of incorporated products.

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This Q&A contains forward-looking statements concerning Murata Manufacturing Co., Ltd. and its group companies' projections, plans, policies, strategies, schedules, and decisions. These forward-looking statements are not historical facts; rather, they represent the assumptions of the Murata Group (the "Group") based on information currently available and certain assumptions we deem as reasonable. Actual results may differ materially from expectations due to various risks and uncertainties. Readers are therefore requested not to rely on these forward-looking statements as the sole basis for evaluating the Group. The Company has no obligation to revise any of the forward-looking statements as a result of new information, future events or otherwise.

Risks and uncertainties that may affect actual results include, but are not limited to, the following:

  1. economic conditions of the Company's business environment, and trends, supply-demand balance, and price fluctuations in the markets for electronic devices and components
  2. price fluctuations and insufficient supply of raw materials
  3. exchange rate fluctuations
  4. the Group's ability to provide a stable supply of new products that are compatible with the rapid technical innovation of the electronic components market and to continue to design and develop products and services that satisfy customers
  5. changes in the market value of the Group's financial assets
  6. drastic legal, political, and social changes in the Group's business environment; and
  7. other uncertainties and contingencies.
The Company undertakes no obligation to publicly update any forward-looking statements included in this Q&A.