PC vendor Asustek Computer Inc (華碩電腦) yesterday reported NT$2.59 billion (US$81.45 million) in net profit for last quarter, snapping two consecutive quarters of losses as gross margin improved and nonoperating gains improved significantly.
The company lost NT$1.68 billion in the first quarter this year. On an annual basis, net profit expanded 36 percent from NT$1.9 billion.
Earnings per share rose to NT$3.5 last month, reversing losses per share of NT$2.3 in the first quarter and NT$2.6 in July last year.
Photo: Fang Wei-chieh, Taipei Times
Gross margin improved to 12.5 percent last quarter from 8.1 percent a quarter earlier and 12.2 percent a year earlier, Asustek said.
The company booked NT$1.2 billion in nonoperating income last quarter.
“Asustek has emerged from an adjustment period,” Asustek chief financial officer Nick Wu (吳長榮) told investors in an online conference. “The company’s operations are entering a normal profit-making period.”
“We are looking at stable growth in the second half and a greater advancement in 2024,” Wu said.
Asustek said that it expects PC revenue to grow 20 percent sequentially this quarter, fueled by rising demand for gaming PCs and consumer notebook computers during the industry’s peak season.
Moreover, PC channel inventory has improved to a healthy level, it said.
Revenue from electronic components such as motherboards is expected to expand 10 percent quarter-on-quarter, the company said.
“The market demand is gradually recovering, but the pace is slower than we expected,” Asustek cochief executive officer S.Y. Hsu (許先越) said. “We are expecting to see a continuous improvement in revenue and profit in the second half compared with the second quarter. We are seeing a positive trend.”
To cope with the seasonal pickup, Asustek kept its inventory unchanged at NT$117.52 billion last quarter, a significant improvement of 43 percent from NT$206.17 billion a year earlier.
Asustek aims to accelerate growth of its new businesses, including commercial notebook computers and servers.
The company said it is targeting compound growth of its commercial notebook computer business of 15 percent in the five years to 2027.
Its server business is expected to grow even faster, at an annual compound rate of 40 percent for this year to 2027, it said.
Its server business currently contributes a low-single-digit percentage to the company’s revenue, it said.
Asustek recently joined local rivals including Quanta Cloud Technology (雲達科技) and Gigabyte Technology Co (技嘉) to become a supplier of servers equipped with Nvidia Inc’s latest artificial intelligence graphics processing units.
Commenting on rules in India to restrict PC imports, Asustek co-chief executive officer Samson Hu (胡書賓) said that the effect of the regulations should be minimal, as the firm has been working with its partners to produce notebook and desktop computers in India.
India is an important market for the company, with Asustek ranked No. 2 in the country’s notebook computer market.
Asustek’s revenue last quarter rose 5 percent from a quarter earlier, but was down 7 percent from the second quarter last year at NT$107.40 billion.
About 64 percent of the revenue was from PCs.
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