Tue, Dec 12, 2017 - Page 12 News List

Pegatron sees 27% monthly revenue dip

SEASONAL EFFECT:Although the loss represents a year-on-year contraction of 3.19 percent, a Pegatron official said the decline fits company estimates and historic patterns

By Lauly Li  /  Staff reporter

Pegatron Corp (和碩), which assembles Apple Inc’s iPhone models, yesterday reported a nearly 27 percent monthly fall in revenue to NT$121.83 billion (US$4.06 billion) last month from the previous month’s NT$166.47 billion, as the peak season waned and smartphone shipments declined.

On an annual basis, the NT$121.83 billion represented a 3.19 percent contraction from last year’s NT$125.84 billion, a company filing with the Taiwan Stock Exchange showed.

“The monthly decline was due to the seasonal effect, which is in line with Pegatron’s estimate and matches the company’s historic pattern,” a Pegatron investor relations official said by telephone.

The official said Pegatron remained optimistic that overall performance this quarter would outpace last quarter’s results on rising demand for communications products and notebook computers.

Notebook shipments are expected to expand by between 15 and 20 percent this quarter from last quarter, and motherboard and desktop computer shipments are expected to drop less than the company’s previous estimate, she said.

Pegatron on Nov. 11 forecast that motherboard and desktop computer shipments would drop by 25 percent at most this quarter, but given stronger-than-expected orders from clients last month, the firm now foresees the pace of the decline slowing, the official said.

The official said that involving delays of key components and rising labor costs, which significantly dragged Pegatron’s earnings down during the July-to-September quarter, are no longer a problem, because communications product shipments have peaked.

The iPhone assembler’s net profit surprisingly shrank 32.4 percent annually to NT$3.63 billion last quarter, dragged down by a disruption in component supply that left employees idle as the company was about to ramp up production of a new communications product.

In related news, Wistron Corp (緯創), which is widely believed to have shared orders for the 5.5-inch iPhone with Hon Hai Precision Industry Co (鴻海精密), on Friday last week reported a mild monthly contraction of 0.73 percent in revenue to NT$89.12 billion last month.

Wistron’s sales performance translated into a 27.73 percent annual expansion from the NT74.12 billion recorded in the same period last year, a company filing with the Taiwan Stock Exchange showed.

Pegatron is believed to assemble 4.7-inch iPhones, including previous generations of the 4.7-inch iPhone and the latest 4.7-inch iPhone 8, while Hon Hai — Pegatron’s largest rival and the assembler of all iPhone X orders — assembles a majority of the 5.5-inch iPhones and some 4.7-inch iPhones, industry sources said.

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