Himax Blames 'Abrupt and Significant Correction' in Auto Chip Demand as Stock Crashes Nearly 30%. Is Now the Time to Buy?

Himax, the fabless chip designer responsible for display driver chips used in TVs, phones and car screens, has lowered its revenue guidance for the final quarter of the year. The company's stock experienced a significant drop, nearly 30%, following an earnings call where President and CEO Jordan Wu attributed the decline to an abrupt and substantial correction in automotive display driver chip orders.

Wu explained that the year started off weak in the first quarter, but demand surged in the second and third quarters due to Chinese automakers expanding overseas. However, a sudden and sizable demand drop was observed after China's National Day holidays in early October. The company also attributes the forecast reduction to Chinese automakers' earlier, overly aggressive export expectations and growing concerns over inventory levels across distribution channels.

The impact is primarily concentrated in automotive display drivers, although panel makers serving customers outside China have kept their forecasts steady, with some even increasing fourth-quarter orders. Automotive timing-controller sales are expected to continue growing from quarter to quarter. Despite the guidance cut, automotive timing-controller sales are projected to grow by more than 40% this year, while overall automotive chip sales rose by 16% year-over-year in the first nine months of 2026.