Micro-Star International Co (微星), a leading maker of PC motherboards, graphics cards and gaming computers, posted weaker-than-expected revenue for last quarter, but is forecast to see sales improve gradually this quarter thanks to the launch of Nvidia Corp’s new graphics processing units (GPUs) and limited effects from a shortage of Intel Corp’s central processing units (CPUs), analysts said last week.
Micro-Star’s consolidated revenue in the July-to-September quarter reached NT$28.7 billion (US$926.5 million), down 1.35 percent from a year earlier, but up 1.4 percent from the previous quarter, company data showed.
“Performance last quarter was mainly affected by slowing demand for the graphics cards used in cryptocurrency mining, while new high-end graphics card products were launched in late September with no significant contribution to third-quarter sales,” Jih Sun Securities Investment Consulting Co (日盛投顧) analyst David Tseng (曾德瑋) said in a research note on Friday.
The much-anticipated launch of Nvidia’s Turing GPUs — a major upgrade from the firm’s Pascal GPU architecture — was delayed to late last month after being scheduled for earlier in the quarter.
“With more Nvidia GPU products hitting the market this month, we expect Micro-Star to see rising graphics card shipments and higher selling prices, which will offset lukewarm growth in notebook computer and motherboard shipments,” Tseng said.
When Nvidia launched new GPUs in 2014 and 2016, Micro-Star’s product mix and profitability improved, so “the new Nvidia GPUs are to ignite Micro-Star’s sales momentum in graphics cards in the fourth quarter,” Tseng said.
Intel’s CPU shortage, which began in the second quarter, has mainly affected middle-tier and low-end PC products, Yuanta Securities Investment Consulting Co (元大投顧) analyst Calvin Wei (魏建發) said.
Micro-Star focuses on high-end gaming computers, so the firm has seen limited effects from the shortage, Wei said in a note on Monday.
“However, Micro-Star might be impacted by the escalating US-China trade war” as the company has sales exposure of up to 20 percent in the US market, including 10 percent for motherboards and graphics cards and 10 percent for computer systems, Wei said.
Micro-Star shares fell 1.82 percent to NT$70.3 in Taipei trading on Friday. They have fallen 8.22 percent since January, while the broader market has dropped 6.8 percent over the period.
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