After posting a net profit decline last year, gaming PC maker Micro-Star International Co (MSI, 微星科技) yesterday forecast growth for next quarter, as PC demand rises due to coronavirus-driven remote working and schooling.
Net profits last year fell to NT$5.59 billion (US$184.88 million), from NT$6.04 billion in 2018, which translated into earnings per share of NT$6.61, down from NT$7.15. Gross margin contracted to 13.16 percent from 13.6 percent.
MSI attributed the profit decline to inventory depletion of graphics processing units for cryptocurrency mining PCs, as well as heavy costs tied to relocating operations to Taiwan, amid a trade dispute between the US and China last year, president and CEO Chiang Sheng-chang (江勝昌) told investors.
Compared with the challenges the company faced last year, Chiang said he was more confident about the effects of the COVID-19 pandemic on the company.
“The pandemic is creating a lot of uncertainties ... but looking at current orders, I believe we still have strong market demand to rely on, which might even increase with the growing trend of telecommuting and distance learning,” he said, adding that much of its popular PC models have since sold out.
Citing the similarities between the situation in Europe and the US and the COVID-19 outbreak in China two months ago, Chiang said that overall market demand for PCs would recover once the virus is contained.
“The impact on PCs and other network and communication devices should be smaller compared with that on general consumer electronics,” he said.
The company is nevertheless seeking to cut operating expenses this year through freight cost management, while retaining a higher cash flow through smaller payouts to shareholders, MSI chairman Joseph Hsu (徐祥) said, suggesting a cash dividend of NT$4.2 per share.
MSI expects revenue in the first quarter to decline nearly 10 percent year-on-year to NT$27 billion, but would recover in the second quarter, boosted by upcoming launches of new central processing units and graphic cards from Intel Corp, Advanced Micro Devices Inc (AMD) and Nvidia Corp, Hsu said.
Those new chips would boost demand for MSI products and raise the average selling prices of PCs and motherboards, Hsu said.
Gross margin is also expected to improve next quarter, he added.
MSI is focusing heavily on its content creation product line that includes laptops, desktops and monitors, which is to make up about 20 percent of the company’s overall shipments, similar to last year.
‘SWASTICAR’: Tesla CEO Elon Musk’s close association with Donald Trump has prompted opponents to brand him a ‘Nazi’ and resulted in a dramatic drop in sales Demonstrators descended on Tesla Inc dealerships across the US, and in Europe and Canada on Saturday to protest company chief Elon Musk, who has amassed extraordinary power as a top adviser to US President Donald Trump. Waving signs with messages such as “Musk is stealing our money” and “Reclaim our country,” the protests largely took place peacefully following fiery episodes of vandalism on Tesla vehicles, dealerships and other facilities in recent weeks that US officials have denounced as terrorism. Hundreds rallied on Saturday outside the Tesla dealership in Manhattan. Some blasted Musk, the world’s richest man, while others demanded the shuttering of his
ADVERSARIES: The new list includes 11 entities in China and one in Taiwan, which is a local branch of Chinese cloud computing firm Inspur Group The US added dozens of entities to a trade blacklist on Tuesday, the US Department of Commerce said, in part to disrupt Beijing’s artificial intelligence (AI) and advanced computing capabilities. The action affects 80 entities from countries including China, the United Arab Emirates and Iran, with the commerce department citing their “activities contrary to US national security and foreign policy.” Those added to the “entity list” are restricted from obtaining US items and technologies without government authorization. “We will not allow adversaries to exploit American technology to bolster their own militaries and threaten American lives,” US Secretary of Commerce Howard Lutnick said. The entities
Minister of Finance Chuang Tsui-yun (莊翠雲) yesterday told lawmakers that she “would not speculate,” but a “response plan” has been prepared in case Taiwan is targeted by US President Donald Trump’s reciprocal tariffs, which are to be announced on Wednesday next week. The Trump administration, including US Secretary of the Treasury Scott Bessent, has said that much of the proposed reciprocal tariffs would focus on the 15 countries that have the highest trade surpluses with the US. Bessent has referred to those countries as the “dirty 15,” but has not named them. Last year, Taiwan’s US$73.9 billion trade surplus with the US
Prices of gasoline and diesel products at domestic gas stations are to fall NT$0.2 and NT$0.1 per liter respectively this week, even though international crude oil prices rose last week, CPC Corp, Taiwan (台灣中油) and Formosa Petrochemical Corp (台塑石化) said yesterday. International crude oil prices continued rising last week, as the US Energy Information Administration reported a larger-than-expected drop in US commercial crude oil inventories, CPC said in a statement. Based on the company’s floating oil price formula, the cost of crude oil rose 2.38 percent last week from a week earlier, it said. News that US President Donald Trump plans a “secondary
RSS