Asustek Computer Inc (華碩) yesterday reported a faster-than-expected 21 percent sequential growth in net profit for last quarter on strong shipment growth and said it expected the growth momentum to carry into this quarter and next year, driven by rising demand for its notebook computers and smartphones, primarily in the Asia-Pacific region.
Net profit expanded to NT$5.81 billion (US$189 million) in the quarter ending Sept. 30, compared with NT$4.94 billion in the second quarter.
Last quarter’s figure surpassed the NT$5 billion estimated by Fubon Securities Investment Services Co (富邦投顧) analyst Arthur Liao (廖顯毅).
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Asustek, the word’s No. 5 PC brand, expects shipments of notebook computers to grow 7.84 percent sequentially to 5.5 million units this quarter, bringing the total shipments this year to about 22.11 million units. Notebook computers are the biggest revenue source of Asustek, accounting for 57 percent of its total revenue.
Shipments of smartphones are expected to soar by 43 percent sequentially to 4 million units this quarter, bringing total shipments this year to 8 million units, the company forecast. It forecast its tablet shipments to increase 12 percent quarter-on-quarter to 2.8 million this quarter.
The shipments growth will help boost the company’s revenue by 13.68 percent to more than NT$129 million in the current quarter as Liao projected, compared with last quarter’s NT$113.48 billion. That meant Asustek will see its revenue set an all-time high this quarter.
Liao yesterday slightly raised his target price of Asustek to NT$355 from NT$350.
He yesterday retained his “Add” rating on Asustek, while he downgraded local PC brand Acer Inc (宏碁) to “Add” from “Buy.”
“Asustek is our favorite among PC original electronics makers in 2015. We believe that the PC sector will stabilize in the next few years and tablets’ cannibalization will be minimal in 2015,” Liao said in a report released yesterday.
Asustek also expects operating margin this quarter to be higher than last quarter’s 4.7 percent, thanks to shipment growth.
Asustek yesterday gave an encouraging outlook for next year.
“The [PC] industry will be flat next year … but, for Asustek, we believe a 15 percent [annual] growth is reachable,” Asustek chief executive Jerry Shen (沈振來) told investors.
“New models will fuel the growth of notebook and desktop computers, and the Asia-Pacific region will be the fastest-growing area,” Shen said.
Asustek plans to launch its new high-end Chi (氣) series next year to compete with Apple Inc’s new Air family and it also plans to roll out updates of its popular entry-level laptop, the T100, as well as new Chromebooks and EeeBooks.
Smartphones are another bright spot as the company expects their shipments to double to 16 million units next year, from this year’s 8 million, Shen said. He said 4G Long-Term Evolution (LTE) phones will account for about 30 percent to 40 percent of next year’s total shipments.
“China and the US are the two focal markets for us next year,” Shen said.
Asustek will begin supplying LTE phones to China Mobile Co (中國移動), China Telecom Co (中國電信) and China Unicom Ltd (中國聯通), he said.
Asustek’s smartphones are now powered by Intel Corp’s chips and the company plans to introduce a second chip supplier next year for low-end models.
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