Asustek Computer Inc (華碩) has delayed its annual launch of a flagship smartphone from April to July at the latest, mainly due to a quarter-long shortage in key components, company executives said yesterday.
Persisting supply constraints on key components and volatility in foreign currency exchange rates would be the two main challenges for Asustek this year, company chief executive officer Jerry Shen (沈振來) told an investors’ conference at the company’s headquarters in Taipei.
The company in November last year told reporters that it hoped to launch its next-generation ZenFone in April this year at the earliest, in an effort to maintain sales momentum, as the ZenFone 3 series product life cycle dissipates toward the end of the first half.
However, shortages in key components have affected Asustek’s plan, Shen said, declining to elaborate on the potential effect on the company’s smartphone business.
The affected components include DRAM, flash memory and flat panels that are used in both notebooks and smartphones, Asustek said.
The component shortages would increase manufacturing costs for Asustek, as component prices rise, industry analysts said.
To cope with rising manufacturing costs, Shen said the company has increased the retail prices for some of its notebook models in selected markets and also plans to hike prices for new models.
With the supply of key components tight, Asustek is to allocate their use to high-margin notebooks such as gaming and two-in-one detachable or convertible products to ensure that the company’s margins remain stable, chief financial officer Nick Wu (吳長榮) said.
Asustek forecast that the proportion of its revenues it gains from its PC business this quarter would drop to 15 percent, from last quarter’s 20 percent, while mobile business revenue would fall by between 10 percent and 15 percent due to seasonal weakness, Wu said.
Looking forward, Shen said Asustek this year hopes to ship close to last year’s 20.61 million PCs.
Revenue from the firm’s PC business is expected to grow mildly year-on-year on the back of increasing sales contributions from higher-priced gaming and two-in-one notebooks, Shen said.
The company last year reported a combined net income of NT$19.2 billion (US$624.08 million), representing NT$25.9 per share, 12 percent higher than 2015’s NT$17.09 billion, or NT$23 per share, company data showed.
Gross margin last year contracted 0.2 percentage points year-on-year to 13.6 percent, while operating margin fell 0.5 percentage points annually to 4.1 percent, the data showed.
HORMUZ ISSUE: The US president said he expected crude prices to drop at the end of the war, which he called a ‘minor excursion’ that could continue ‘for a little while’ The United Arab Emirates (UAE) and Kuwait started reducing oil production, as the near-closure of the crucial Strait of Hormuz ripples through energy markets and affects global supply. Abu Dhabi National Oil Co (ADNOC) is “managing offshore production levels to address storage requirements,” the company said in a statement, without giving details. Kuwait Petroleum Corp said it was lowering production at its oil fields and refineries after “Iranian threats against safe passage of ships through the Strait of Hormuz.” The war in the Middle East has all but closed Hormuz, the narrow waterway linking the Persian Gulf to the open seas,
Apple Inc increased iPhone production in India by about 53 percent last year and now makes a quarter of its marquee devices there, reflecting the US company’s efforts to avoid tariffs on China. The company assembled about 55 million iPhones in India last year, up from 36 million a year earlier, people familiar with the matter said, asking not to be named because the numbers aren’t public. Apple makes about 220 million to 230 million iPhones a year globally, with India’s share of the total increasing rapidly. Apple has accelerated its expansion in the world’s most populous country in recent years, bolstered
HEADWINDS: The company said it expects its computer business, as well as consumer electronics and communications segments to see revenue declines due to seasonality Pegatron Corp (和碩) yesterday said it aims to grow its artificial intelligence (AI) server revenue more than 10-fold this year from last year, driven by orders from neocloud solutions clients and large cloud service providers. The electronics manufacturing service provider said AI server revenue growth would be driven primarily by the Nvidia Corp GB300 server platform. Server shipments are expected to increase each quarter this year, with the second half likely to outperform the first half, it said. The AI server market is expected to broaden this year as more inference applications emerge, which would drive demand for system-on-chip, application-specific integrated circuits
PROJECTION: TSMC said it expects strong growth this year, with revenue in US dollars projected to grow by about 30 percent, outperforming the industry Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday reported consolidated sales last month reached NT$317.66 billion (US$9.98 billion), the highest ever for the month of February, driven by robust demand for chips built using the company’s advanced 3-nanometer (3nm) process. Last month’s figure was up 22.2 percent from a year earlier, but fell 20.8 percent from January, the world’s largest contract chipmaker said in a statement. For the first two months of the year, TSMC posted cumulative sales of NT$718.91 billion, up 29.9 percent from a year earlier. Analysts attributed the growth to sustained global demand for artificial intelligence (AI) products
RSS