Advantech Co (研華) aims to boost its revenue and net profit by a double-digit percentage this year in light of fledging demand for industrial Internet-of-Thighs (IoT) devices and recovering demand from US customers.
However, the strength of the New Taiwan dollar against the US dollar is likely to continue to weigh on the performance of the world’s largest industrial computer maker.
“The foreign exchange factor is the biggest risk. We are not worried about growth [momentum],” Advantech said.
The NT dollar’s 0.51 percent appreciation against the greenback eroded 7 percent of company’s revenue last month, Advantech said.
Revenue rose just 2.65 percent year-over-year to NT$3.93 billion (US$133 million) from NT$3.83 billion in December 2016.
However, revenue for the full year still reached a record high of NT$44.38 billion, up 5.65 percent from NT$42 billion in 2016, the company said in a statement yesterday.
Due to the volatile foreign exchange rates, the company in November halved its revenue growth forecast for last year from 10 percent to 5 percent.
“The foreign-exchange factor is not a factor we can control,” Advantech chairman Liu Ke-cheng (劉克振) told a media briefing. “We are targeting double-digit percentage growth this year in revenue and profit.”
Liu attributed the growth forecast to fledging demand for industrial IoTs.
“We have a strong feeling that this year will be the starting year of an industrial IoT boom over the next 15 years,” he said. “It is not a fanfare, it is becoming reality. Almost all company executives we have met lately have shown a strong interested in introducing industrial IoT systems to their factories.”
Growing demand for industrial IoT hardware would also help stimulate demand for Advantech’s software and solutions for “smart” factories, Liu said.
Advantech has budgeted an initial fund of US$2 million to purchase software related to industrial IoT from start-ups, Liu said.
It is also seeking to acquire software that enables machine vision and implies artificial intelligent (AI) technology, he said.
Advantech expects industrial IoT and embedded board module businesses to continue to see solid growth during the current quarter, extending its strength last quarter, spokesperson Jill Su (蘇智蘋) said.
Another bright spot is expected to be a pickup in customer demand from the US. The company is seeing improving demand for its products used in telecom equipment as demand for 3G equipment remains strong in emerging markets, the company said.
Last year, Advantech saw its business soften in the US.
Separately, the company yesterday announced it has formed an alliance to develop industry 4.0 systems catering to demand for local printed circuit board (PCB) manufacturers. The alliance includes local PCB makers, the Taiwan Printed Circuit Association and researcher house Market Intelligence and Consulting Institute (資策會產業情報研究所).
It is also planning to launch a new start-up next year to provide industry 4.0 systems for other companies and other sectors such as shoemaking and electronics manufacturers.
The government is providing NT$100 million to fund for the project.
Advantech shares yesterday dropped 0.44 percent to NT$225 in Taipei trading.
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