Asustek Computer Inc (華碩), the world’s No. 5 PC brand, yesterday said it expected revenues to drop 5 to 10 percent in the fourth quarter from the third quarter, in wake of flooding in Thailand, which has impacted production of hard disk drives.
The company joined its bigger domestic rival, Acer Inc (宏碁), which last week also predicted a revenue drop within a similar range for the fourth quarter, given the severe floods that have wreaked havoc in Thailand — which produces nearly half of the world’s hard drives.
“If we take out the flooding factor, fourth-quarter revenue may remain flat from the third,” Asustek chief executive Jerry Shen (沈振來) told investors.
To maintain profitability, the company will join Acer in raising average sales prices and downgrade hardware of selected notebooks starting in the fourth quarter to reflect the price hike of hard drives, he said.
The company expected an average of a 3 to 6 percent price increase for notebooks industry-wise because of the hard drive shortage.
Asustek posted revenues of NT$102.04 billion (US$3.4 billion) in the third quarter, up 24 percent year-on-year and a 42 percent quarter-on-quarter jump.
The figure was a record after the company split its manufacturing arm from its brand-name business in July last year. The rise was attributed to strong growth in shipments in Eastern Europe and the Asia-Pacific, especially China, it said.
Earnings were NT$4.68 billion, or NT$6.22 per share, up 11 percent from last year and a rise of 30 percent from the second quarter.
The company aims to ship 4.1 million notebooks, 1.2 million netbooks, 600,000 tablets and 6 million motherboards in the fourth quarter.
It shipped 4.3 million notebooks, 1.3 million netbooks, 800,000 tablets and 6.3 million motherboards for the third quarter.
The company expects emerging markets, which currently contributes 62 percent to total sales compared with 38 percent for mature markets, to drive growth next year.
The emerging markets include China, Brazil and India.
New products that will drive growth include the Padfone — a smartphone-tablet combo — to be unveiled in February next year and a second model of its popular tablet, the Transformer, this month.
Despite Asustek’s efforts to boost its PC presence, Cheng Kai-ming (鄭開明), an analyst with Horizon Securities (宏遠證券), does not expect Asustek to see any changes in its PC ranking next year.
“The competition is tough as the top four vendors are very strong. Unless Acer continues to lose market share, Asustek’s ranking next year will be little changed even if one or two models of its products manage to stand out,” Cheng said.
Shares of Asustek yesterday closed down 3 percent to NT$210.5 on the Taiwan Stock Exchange before the investors’ conference.
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday obtained the government’s approval to inject an additional US$7.5 billion into its US subsidiary, the Department of Investment Review said in a statement. The department approved TSMC’s application of investing in TSMC Arizona Corp, which is engaged in the manufacturing, sales, testing and design of IC and other semiconductor devices, it said. The latest capital injection follows a US$5 billion investment for TSMC Arizona approved in June. The chipmaker has broken ground on two advanced fabs in Arizona with aggregated investments approved by the department totaling US$24 billion thus far. According to TSMC, the first Arizona
FRIENDLY TAKEOVER: While Qualcomm Inc’s proposal to buy some or all of Intel raises the prospect of other competitors, Broadcom Inc is staying on the sidelines Qualcomm Inc has approached Intel Corp to discuss a potential acquisition of the struggling chipmaker, people with knowledge of the matter said, raising the prospect of one of the biggest-ever merger and acquisition deals. California-based Qualcomm proposed a friendly takeover for Intel in recent days, said the sources, who asked not to be identified discussing confidential information. The proposal is for all of the chipmaker, although Qualcomm has not ruled out buying some parts of Intel and selling off others. It is uncertain whether the initial approach would lead to an agreement and any deal is likely to come under close antitrust scrutiny
SECURITY CONCERNS: The proposed ban on Chinese autonomous vehicle software and hardware would go into effect with the 2027 and 2030 model years respectively The US Department of Commerce today is expected to propose prohibiting Chinese software and hardware in connected and autonomous vehicles on US roads due to national security concerns, two sources said. US President Joe Biden’s administration has raised concerns about the collection of data by Chinese companies on US drivers and infrastructure as well as the potential foreign manipulation of vehicles connected to the Internet and navigation systems. The proposed regulation would ban the import and sale of vehicles from China with key communications or automated driving system software or hardware, said the two sources, who declined to be identified because the
Taiwan Semiconductor Manufacturing Co (TSMC) today said it has no plans for new foreign investments, following a report that the chipmaker was looking to team up with Samsung for a project in the United Arab Emirates (UAE). The Wall Street Journal yesterday cited anonymous sources familiar with the interactions as saying that the chipmakers have discussed projects in the UAE in the coming years that could be worth more than US$100 billion. Top executives at TSMC have visited the UAE recently and talked about a plant complex on par with some of the company’s largest and most advanced facilities in Taiwan, the