Inventec Corp (英業達) yesterday reported a far weaker-than-expected net profit of NT$1.21 billion (US$37.87 million) for last quarter, dragged down by an unprofitable solar power business and foreign-exchange losses.
The results were 27.1 percent lower than consensus estimates of NT$1.66 billion.
The contract electronics maker saw its net income plunge 37.62 percent from the NT$1.94 billion profit reported for same period last year and fall 14.18 percent from the previous quarter’s NT$1.41 billion.
“The New Taiwan dollar’s appreciation and falling average selling prices of solar power products significantly hurt Inventec’s profitability,” chief financial officer Yu Chin-pao (游進寶) told an investors’ conference at the company’s Taipei headquarters.
Inventec’s solar power business, which contributed 2.3 percent to its total revenue of NT$111.6 billion last quarter, lost money last quarter because of unfavorable pricing trends, Yu said.
A foreign-exchange loss of NT$821 million also hurt profitability, Yu said.
Gross margin fell by 0.26 percentage points to 5.28 percent last quarter from a quarter earlier, while operating margin dropped 0.24 percentage points to 1.68 percent, he said.
Inventec expects its solar power business to return to black this quarter, as the average selling prices for solar cells has jumped by 25 percent compared with the previous quarter, Yu said.
Revenue from the solar power segment is expected to expand by a double-digit percentage this quarter from the third quarter, he said.
David Ho (何代水), the chief executive officer of mobile devices subsidiary Inventec Appliances Corp (英華達), said revenue and shipments are to grow from last quarter and hit the peak for this year, based on clients’ robust order forecasts.
The subsidiary’s revenue, which accounted for 15.4 percent of last quarter’s total company revenue, is expected to climb by a “high” single-digit percentage from the quarter ending on Sept. 30, Inventec said.
Inventec Appliances helps assemble smartphones for Chinese handset vendor Xiaomi Corp (小米) and US wearable device vendor Fitbit Inc.
The company reportedly manufactures Apple Inc’s wireless AirPods and would start shipping next month at the earliest, but Ho declined to comment on the reports.
Inventec president Huang Kuo-chun (黃國鈞) said the company’s PC and sever segments, which accounted for 82.3 percent of total revenue, are expected to remain at similar levels from last quarter, despite the beginning of the slow season for the PC industry.
Orders for the firm’s commercial PCs and servers are stable this quarter, he added.
Inventec’s commercial PC clients include HP Inc and Dell Inc, according to the company.
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