Synnex Technology International Corp’s (聯強) revenue will grow 7 percent year-on-year in the third quarter, despite escalating competition, Yuanta Securities Investment Consulting Co (元大投顧) forecast.
Synnex — which distributes computers and handsets — can expect revenue of NT$90.6 billion (US$2.88 billion) this quarter from NT$84.51 billion in the same period last year, Yuanta analyst Calvin Wei (魏建發) said on Monday.
However, growth momentum is expected to diminish next quarter, while Synnex could report an annual decline of 2 percent in revenue during the slow season, he forecast.
In the first half, Synnex’s revenue expanded 12 percent annually to NT$161.1 billion, bucking the industry’s downtrend.
The company attributed the growth to market share gain and strong demand for computers and software in Indonesia and China.
Synnex, the largest electronics distributor in Asia, helps sell notebook computers, mobile phones and other electronic devices for HP Inc, Nokia Oyj, Acer Inc (宏碁), Asustek Computer Inc (華碩) and Huawei Technologies Co (華為).
However, growing competition from rivals affected the company’s gross margin last quarter, with margin falling to 3.37 percent from 3.73 percent in the first quarter.
Wei had projected a gross margin of 3.6 percent for the quarter.
Operating profit also contracted 22 percent to NT$862 million in the second quarter from NT$1.1 billion the previous quarter, a company financial statement showed.
That represents an annual reduction of 5.79 percent from the NT$915 million posted in the same period last year.
Last quarter’s operating profit was 26 percent lower than market expectations, Wei said.
Net profit fell 7.44 percent quarter-on-quarter and 13.85 percent year-on-year to NT$1.12 billion last quarter, with Wei blaming foreign-exchange losses of NT$270 million for the disappointing bottom line, as the yuan plummeted against the US dollar.
Synnex’s forex losses might improve this quarter as the yuan stabilizes, he said.
Synnex shares yesterday sank for the fifth consecutive session in Taipei trading to NT$36.35, a decline of 1.22 percent from Tuesday.
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