Asustek Computer Inc (華碩電腦) yesterday forecast its notebook computer shipments would drop 6 percent to 4.6 million units this quarter from last quarter, because the European and Chinese markets are still in a slow season, despite recovering demand in the US and Asia Pacific.
However, the company’s estimate reflects a 12 percent year-on-year expansion, driven largely by shipments of the latest T100 detachable notebooks, Asustek chief executive officer Jerry Shen (沈振來) told reporters after an investors’ conference in Taipei.
Tablet shipments are forecast to grow 33 percent quarter-on-quarter and 40 percent year-on-year to 2.8 million units this quarter, while smartphone shipments are projected to increase significantly to 1.5 million units from 0.2 million units last quarter, Shen said.
Photo: Wang Wen-lin, Taipei Times
“Market demand for ZenFone-series smartphone products appeared pretty solid in every country we had been to,” Shen said at the conference.
Earlier this year, the company launched three mid-tier smartphones at the Consumer Electronics Show (CES) in Las Vegas.
The world’s fifth-largest PC vendor said sales of the new handsets were launched last month in countries including Taiwan, China, Indonesia, Malaysia, Thailand, Vietnam and Singapore.
The company plans to launch its new smartphone products in other emerging markets, such as Russia, India and Brazil, Shen said.
While it “should be possible” for Asustek to sell between 5 million and 10 million units of smartphones this year, the company’s handset business may stay in the red for the second consecutive year this year, chief financial officer David Chang (張偉明) told investors.
Chang said Asustek’s goal is to expand its global smartphone market share this year, and will try to reach break-even by the end of the year after achieving economies of scale.
Last year, Asustek sold 1.5 million smartphones, but posted NT$1 billion (US$33 million) in losses.
“Asustek’s smartphone [business] will likely see no profits or become loss-making if it falls below the company’s annual shipment target of 5 million units in 2014,” Taipei-based Citigroup analyst Wei Chen (陳思維) said in a note.
To better control its costs, Asustek in the future may consider adopting cheaper handset chips made by Taiwan’s MediaTek Inc (聯發科) or the US’ Qualcomm Inc, Shen said.
The company also aims to become an “affordable Apple” with smartphones that represent “premium luxury” at a price range of between NT$5,000 and NT$10,000 over the next two or three years, he said.
Nonetheless, Intel Corp will remain Asustek’s top industry partner, as the two sides have agreed to commit to a long-term marketing campaign for the ZenFone-series models, which all sport Intel’s Atom processors, Shen said.
In the January-to-March quarter, Asustek saw its net profit slide 23 percent quarter-on-quarter and 28 percent year-on-year to NT$4.36 billion (US$144.72 million), due to lower non-operating income, with earnings per share (EPS) of NT$5.87.
The first-quarter EPS was less than the NT$6.89 forecast by Citigroup and NT$6.09 predicted by UBS Securities.
Revenue in the first quarter declined 16 percent quarterly and 5 percent annually to NT$100.27 billion, with gross margin of 13.2 percent and operating margin of 4.7 percent, the company said.
Shares in Asustek fell 0.45 percent to NT$331.5 yesterday before the company released its first-quarter results.
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