After witnessing a slew of smartphone introductions by global vendors at the Mobile World Congress (MWC) in Barcelona, Spain, last week, Merrill Lynch said it was cautious on the outlook for Taiwanese makers amid intensifying competition.
In particular, HTC Corp (宏達電), the world’s largest maker of handsets running on Microsoft’s Windows platform, is likely to experience margin erosion and a decline in average selling prices, Merrill Lynch analysts Laura Chen (陳佳儀 ) and Daniel Kim said in a report released on Tuesday.
The report said that HTC faces rising competition from its South Korean rivals — LG Electronics Inc and Samsung Electronics Co — with each planning to roll out between 10 and 20 Windows Mobile-based smartphone models this year, Merrill Lynch analysts Laura Chen (陳佳儀 ) and Daniel Kim said in a report released on Tuesday.
Competition in the Android-based smartphone market is also growing. To date, HTC is the only maker that has launched Android-based smartphones, but competitors such as Motorola Inc, Garmin-Asus and China’s Huawei Technologies Ltd (華為) are planning to launch their own models later this year.
In addition, HTC could be at a disadvantage because it has to expand its system and continues “to focus on operator-optimized service instead of their own mobile application shops,” Chen and Kim said.
“Similar to Apple Computer Inc’s iTunes application store, Nokia Corp announced the launch of its Ovi Store for downloading free and paid-for applications and content. Microsoft will also have a new Marketplace with thousands of applications,” the analysts wrote.
Although the smartphone market is showing momentum, the fierce competition, declining operator subsidies and potentially weak demand worry the two analysts.
They said they would take a wait-and-see approach and closely observe sell-through on HTC’s new products, such as Touch Diamond 2, Touch Pro 2 and HTC Magic, in the second quarter.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
Apple Inc has been developing a homegrown chip to run artificial intelligence (AI) tools in data centers, although it is unclear if the semiconductor would ever be deployed, the Wall Street Journal reported on Monday. The effort would build on Apple’s previous efforts to make in-house chips, which run in its iPhones, Macs and other devices, according to the Journal, which cited unidentified people familiar with the matter. The server project is code-named ACDC (Apple Chips in Data Center) within the company, aiming to utilize Apple’s expertise in chip design for the company’s server infrastructure, the newspaper said. While this initiative has been
GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said that revenue would rise moderately in the second half of this year, driven primarily by robust demand for advanced wafers used in high-bandwidth memory (HBM) chips, a key component of artificial intelligence (AI) technology. “The first quarter is the lowest point of this cycle. The second half will be better than the first for the whole semiconductor industry and for GlobalWafers,” chairwoman Doris Hsu (徐秀蘭) said during an online investors’ conference. “HBM would definitely be the key growth driver in the second half,” Hsu said. “That is our big hope
The consumer price index (CPI) last month eased to 1.95 percent, below the central bank’s 2 percent target, as food and entertainment cost increases decelerated, helped by stable egg prices, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday. The slowdown bucked predictions by policymakers and academics that inflationary pressures would build up following double-digit electricity rate hikes on April 1. “The latest CPI data came after the cost of eating out and rent grew moderately amid mixed international raw material prices,” DGBAS official Tsao Chih-hung (曹志弘) told a news conference in Taipei. The central bank in March raised interest rates by