Shares of Largan Precision rebounded 4.79% on July 11, 2025, after an early dip, while Taiwan’s Taiex index rose 0.31%.

The company reported NT$4.22 billion (US$144.2 million) in Q2 forex losses, driving an 84% drop in net profit to its lowest in 13 years.

Largan’s gross margin slipped to 53.6% and quarterly sales fell 20%, though year-on-year revenue rose 6%.

Chairman Adam Lin warned of currency headwinds but expects stronger sales in Q3 as Apple and others prepare launches.

Largan plans to supply higher-margin iris apertures by 2026 to boost prices and expand its premium product mix.

🔗 Source: Focus Taiwan

🧠 Food for thought

1️⃣ Currency fluctuations pose systematic risks for export-dependent tech manufacturers

Largan’s NT$4.22 billion forex loss highlights the vulnerability of Taiwan’s tech sector to currency movements.

The Taiwan dollar’s 10.97% rise against the USD directly caused Largan’s quarterly profit to plunge 84%, demonstrating how currency risk can overwhelm operational performance even for highly profitable companies1.

This vulnerability is especially acute for Taiwanese manufacturers because they typically collect revenue in US dollars while incurring expenses in local currency, creating an inherent mismatch.

Largan’s high gross margin of 53.6% (down from 54.6%) demonstrates that even companies with strong pricing power and technical advantages remain exposed to macroeconomic forces beyond their control2.

Taiwan’s export-oriented business model creates a persistent dilemma: a strengthening currency makes exports less competitive while weakening the translated value of foreign earnings, a challenge shared across Taiwan’s semiconductor and component industries.

2️⃣ Smartphone camera lens market remains on strong growth trajectory despite challenges

Despite Largan’s quarterly setback, the company operates in a robustly expanding market projected to grow from $5.42 billion in 2025 to $8.04 billion by 2030, representing a CAGR of 8.21%3.

This growth is driven by the ongoing evolution toward increasingly complex lens configurations, with trends moving from standard setups toward more sophisticated 7P, 8P, and 9P lens systems that command higher prices3.