Rexon Industrial Corp Ltd (力山工業), a maker of fitness equipment and power tools, said its shipments of home fitness bikes are expected to rise each quarter this year as a major US client continues to expand its business in Britain and Canada.
The Taichung-based company also forecast that shipments of treadmills would grow in the second half of the year as the company enters the peak season and factory utilization increases on higher automation and better efficiency.
An analyst at a local brokerage, who asked not to be named, said that Rexon's orders of fitness equipment and new products from one of its major US customers have increased so far this year, compared with last year.
“Rexon is the largest supplier of exercise bikes and the only supplier of treadmills to its major US client,” the analyst said.
“The company's shipments of woodworking machines are also expected to increase this year as demand in the US market continues to grow,” he said.
The firm has 14 production lines for woodworking machine in its factory in Tongxiang, China.
In light of higher US tariffs imposed on Chinese goods, major woodworking machine manufacturers have been looking for other production bases since July last year, the analyst said.
To cope with orders diverted from China, the company this quarter has added four production lines at its factory in Taichung’s Dali District (大里) for making woodworking machines and another 15 production lines for fitness equipment, he said.
Rexon shares fell 0.51 percent to close at NT$77.6 in Taipei trading yesterday.
The shares have risen 5.01 percent since May 9 after investors were impressed by the company’s first-quarter performance and a growing contribution from the US market.
First-quarter net income grew 58.57 percent year-on-year to NT$827.69 million (US$26.37 million), from NT$13.89 million the previous year, or earnings per share of NT$4.56, thanks to asset sales at its factory in Hangzhou, China, the company said.
Without the asset disposal gains, earnings per share were NT$0.63, compared with NT$0.08 the previous year and NT$1.35 the previous quarter.
Rexon sold the Hangzhou factory for NT$831.4 million, a disposal gain of about NT$707.94 million, it said.
Gross margin increased 3.23 percentage points to 18.93 percent, while revenue rose 101.38 percent to NT$2.04 billion from NT$1.01 billion the previous year.
Fitness equipment contributed 61 percent of revenue last year, power tools made up 35 percent, while automotive plows accounted for 4 percent, company data showed.
This story has been corrected since it was first published.
DECOUPLING? In a sign of deeper US-China technology decoupling, Apple has held initial talks about using Baidu’s generative AI technology in its iPhones, the Wall Street Journal said China has introduced guidelines to phase out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) from government PCs and servers, the Financial Times reported yesterday. The procurement guidance also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic options, the report said. Chinese officials have begun following the guidelines, which were unveiled in December last year, the report said. They order government agencies above the township level to include criteria requiring “safe and reliable” processors and operating systems when making purchases, the newspaper said. The US has been aiming to boost domestic semiconductor
Nvidia Corp earned its US$2.2 trillion market cap by producing artificial intelligence (AI) chips that have become the lifeblood powering the new era of generative AI developers from start-ups to Microsoft Corp, OpenAI and Google parent Alphabet Inc. Almost as important to its hardware is the company’s nearly 20 years’ worth of computer code, which helps make competition with the company nearly impossible. More than 4 million global developers rely on Nvidia’s CUDA software platform to build AI and other apps. Now a coalition of tech companies that includes Qualcomm Inc, Google and Intel Corp plans to loosen Nvidia’s chokehold by going
ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to