The study is about the relationship between competitive advantage and performance, and the respondent in this study is the optical disc drive industry in Taiwan. Competitive advantage of a company is analyzed from the viewpoint of key success factors and resource based theory. The performance of a company is measured by the method of financial ratio analysis. After analyzing the related data, it is discovered that: 1. The key success factors of optical disc drive industry include the abilities of research /development and low cost. 2. The essential resources and capabilities of optical disc drive manufacturer include patent, research/development expense, speed for new products, economies of scale and obtaining materials. 3. It isn’t absolutely that a company with competitive advantage would have better financial performance, and the focus strategy plays an important role in it. A company with competitive disadvantage might have better financial performance due to correct strategies adopted.