Hon Hai Precision Industry Co (鴻海精密) has clinched a NT$17 billion order for 2 million computers from Dell Computer Corp, the world's largest manufacturer of computers, Chinese-language media reported yesterday.
The bare-bones system, which does not include a monitor, is likely to be the OptiPlex SX260, a slim desktop computer aimed at corporate users.
Jonathan Chen (
The new order may increase Dell's purchases from Hon Hai by 50 percent.
"If this report is true, this will increase the number of computers Hon Hai makes for Dell [from four] to around 6 million in 2003," said Eve Jung (
Hon Hai spokesman Edmund Ding (
The company has recently proven a top choice amongst major manufacturers.
"Based on its high economy of scale, Hon Hai kept winning orders from Hewlett-Packard Co, Apple Computer Inc and Dell in the second half of 2002," Jung said.
"We estimate that Hon Hai's sales from the PC business could grow by 15 percent in 2003, with the main contribution from increasing orders for system assembly and motherboard manufacturing," he said.
With a recovery in the computer market still uncertain, slim models that can retail for around US$500 including a display screen should find favor in the corporate sector.
The last major round of corporate spending was in 1999 prior to the switch to year 2000, and Jung said many vendors are pinning their hopes next year on a new round of buying to replace older models that are now approaching the end of their life cycle.
If the expansion in system manufacturing from this order is added to Hon Hai Precision's growth in other product areas -- such as communications devices -- the company is heading for a rosy 2003, the analysts said.
"Next year Hon Hai will see around 30 percent growth overall," Chen said.
This means sales should top NT$300 billion next year from around NT$225 billion this year.
Hon Hai's increasing orders may be due to a change in its business model.
"Right now Hon Hai is aiming globally to be an electronics manufacturing service [EMS] provider," said Chen. "This order is part of that process."
An EMS provider is a higher grade of original equipment manufacturer because it also provides some design services.
The company is on track to achieve greater global positioning. Last week, Hon Hai was rated the No. 2 technology company in Taiwan -- second only to Taiwan Semiconductor Manufacturing Co (台積電) -- in the Far Eastern Economic Review's latest ranking of Asia's 200 leading companies.
Dell remained tight-lipped about the details of any orders for next year yesterday.
DECOUPLING? In a sign of deeper US-China technology decoupling, Apple has held initial talks about using Baidu’s generative AI technology in its iPhones, the Wall Street Journal said China has introduced guidelines to phase out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) from government PCs and servers, the Financial Times reported yesterday. The procurement guidance also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic options, the report said. Chinese officials have begun following the guidelines, which were unveiled in December last year, the report said. They order government agencies above the township level to include criteria requiring “safe and reliable” processors and operating systems when making purchases, the newspaper said. The US has been aiming to boost domestic semiconductor
Nvidia Corp earned its US$2.2 trillion market cap by producing artificial intelligence (AI) chips that have become the lifeblood powering the new era of generative AI developers from start-ups to Microsoft Corp, OpenAI and Google parent Alphabet Inc. Almost as important to its hardware is the company’s nearly 20 years’ worth of computer code, which helps make competition with the company nearly impossible. More than 4 million global developers rely on Nvidia’s CUDA software platform to build AI and other apps. Now a coalition of tech companies that includes Qualcomm Inc, Google and Intel Corp plans to loosen Nvidia’s chokehold by going
ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to