Compal Electronics Inc (仁寶電腦), the world’s second-biggest contract notebook computer maker, said yesterday its first-quarter shipments would likely fall by 10 percent from the previous quarter, while it had negotiated with clients to raise prices next month because of higher production costs.
The company made the shipment projection and new pricing announcement at the Taiwan Investor Conference in Taipei organized by Citigroup Global Markets, according to a client note issued by Citigroup analyst Wei Chen (陳思維).
“The latest company guidance supports our view ... It should not be a surprise, post multiple guidance revisions from the company,” Chen said in the note.
Compal spokesman Gary Lu (呂清雄) did not return calls yesterday for comment on the new shipment forecast, which was the notebook maker’s third such downward adjustment in the last five months, at a time when the company was facing eroding margins owing to slowing demand in the US, a strengthening NT dollar and rising labor costs in China.
In November, Compal first revised its shipment forecast to a quarterly decline of up to 5 percent from the flattish performance it predicted previously, owing to weaker market demand.
In late January, the company again adjusted its quarterly shipment forecast, predicting a fall of between 5 and 10 percent in the first quarter after Intel Corp found a flaw in its 6-Series chipset, which connects its Sandy Bridge processors to the other parts of the PC system.
Compal is now expected to ship between 10.4 million and 10.9 million notebooks this quarter, after the company said yesterday its shipment this month could be between 4 million and 4.5 million units from 3 million units for last month. The company shipped 3.4 million units of notebooks in January.
For this year, the company said it expected to ship 55 million notebooks, up from 48 million units last year, according to the note.
Yesterday, Compal also set full-year shipments at 3.5 million tablet PCs, 8 million TVs and 2 million all-in-one computers, the note showed.
“Price competition has stopped so far this year, and Compal has successfully re-negotiated new pricing to reflect higher input costs, which will be effective in March,” Chen wrote.
“We believe margins will bottom in the first quarter and start to stabilize; however, we see no visibility to margin expansion in the near term,” he said.
Separately, larger rival Quanta Computer Inc (廣達) said yesterday it shipped 3.2 million notebooks last month, down 23.8 percent from the previous month and the lowest in the past 17 months.
The world’s largest contract notebook maker said earlier that its laptop shipments in the first quarter would decline more than 10 percent because of Intel’s chipset recall.
Quanta said in an e-mailed statement yesterday that it posted a consolidated revenue of NT$60 billion (US$2 billion) last month, down 21.7 percent month-on-month and 18.9 percent year-on-year because of seasonal effect and fewer work days.
Smaller rival Wistron Corp (緯創), meanwhile, saw its consolidated revenue fall by 19.4 percent month-on-month and 14.33 percent year-on-year to NT$36.7 billion last month, according to a separate statement.
The company shipped 1.75 million notebooks last month, 22 percent lower than the 2.25 million units it shipped in January, it said.