File photo: VCG

China's tech company Wingtech, the parent company of Nexperia, reported on Friday a positive growth ranging from semiconductor to auto businesses in its third quarter financial report, despite external challenges.

Wingtech announced that in the third quarter, its semiconductor business achieved revenue of 4.3 billion yuan ($603 million), up 12.20 percent year-on-year, with a gross profit margin of 34.56 percent and a net profit of 724 million yuan, according to the report that the company published at the Shanghai Stock Exchange on Friday.

By sales region, the company's semiconductor business revenue in the Chinese market reached a quarterly record high in the third quarter, representing a year-on-year increase of about 14 percent.

Revenue from the Chinese market accounted for 49.29 percent of the company's global total, continuing to be the fastest-growing and top strategic priority region.

Outside China, revenue in other Asian markets achieved mid-single-digit year-on-year growth, with noticeable increases in automotive customer revenue in regions such as South Korea, driven by new energy vehicle models, said the report.

However, uncertainties persist. After the reporting period, Nexperia BV and Nexperia Holding BV received an order from the Dutch Ministry of Economic Affairs and Climate Policy, as well as a ruling from the Enterprise Chamber of the Amsterdam Court of Appeal, said the company.

The developments and potential impacts of these related events are difficult to quantify, and there remains uncertainty as to whether the semiconductor business can sustain the sound growth momentum seen in the first three quarters, the company said, noting that if control over Nexperia cannot be restored before the end of 2025, the company may face stage-specific risks of downward adjustments in revenue, profit, and cash flow.

Nexperia was legally acquired by China's Wingtech Technology in 2018 for $3.6 billion, according to media reports. Yet on September 30, the Dutch Ministry of Economic Affairs issued an administrative order restricting the business decisions of Nexperia and its affiliated entities, depriving Chinese shareholders of their normal control.

Wingtech subsequently issued a statement, expressing a strong protest against such discriminatory treatment targeting Chinese-funded enterprises.  

China's Ministry of Commerce (MOFCOM) recently slammed the Netherlands for meddling in the operations of Nexperia, saying that the Dutch side had violated market principles.

"China firmly opposes the Dutch side's overstretching the national security concept and direct intervention in the company's internal affairs," said He Yongqian, spokesperson for the MOFCOM, at a regular press conference on October 16, adding that China will take necessary measures to resolutely safeguard the lawful rights and interests of Chinese enterprises.

Global Times