TAIPEI: Inventec Corp, a computer and mobile device manufacturer, reported a lower-than-expected profit for last year mainly due to weakness in its solar business.
Net income totaled NT$7.09 billion (US$222.48 million) last year, or earnings per share of NT$1.98, compared with the previous year’s NT$7.07 billion.
“The solar business was affected by the US government’s decision to impose anti-dumping tariffs on Taiwanese products, which affected demand for solar energy products,” Inventec chief financial officer Yu Chin-pao told an investors’ conference.
Inventec believes solar product demand will improve slowly this year, but the company’s solar segment is still facing pressure to make a profit amid declining prices and higher US tariffs, Yu said.
The company expects a 20 percent quarterly decline in sales this quarter from NT$112.67 billion last quarter due to fewer working days, with notebook computer shipments likely to decline sequentially by between 15 percent and 20 percent, he said.
“However, we are positive that revenue will grow quarter-on-quarter this year,” Yu said.
Gross margin could also stay above 5 percent throughout this year, after the figure rose 0.5 percentage points to 5.4 percent last year from the previous year’s 4.9 percent, thanks to an improved product mix, he added.
Inventec president Huang Kuo-chun said total shipments across the board would outpace last year’s 70 million units, driven by strong demand for servers and new orders for smart devices.
Earlier this year, Inventec chairman Richard Lee said the company plans to boost PC and non-PC product shipments by more than 42 percent year-on-year to 100 million units this year.
Shipments of PC-related products would grow in tandem with the rising demand for servers and commercial laptops this year, Huang said, without elaborating.
Earlier this month, International Data Corp said global PC sales would fall 4.9 percent to 293.1 million units this year, after sales fell 2.2 percent year-on-year last year.
Desktop PC shipments would drop 6.2 percent this year from last year and laptop shipments would fall 3.9 percent, IDC said.
“We maintain an optimistic outlook for the global PC industry because of the high-margin commercial PC business,” Huang said.
The company expects shipments of smart devices to grow by between 30 percent and 40 percent to between 65 million and 70 million units this year, fueled by new orders from new clients, said David Ho , chief executive of Inventec’s handset subsidiary, Inventec Appliance Corp .
Ho said the company has started to ship wearable products, but given that average selling prices are relatively low, he foresees the products making a meaningful revenue contribution in the fourth quarter of this year at the earliest.
Inventec’s PC-related segment accounted for 60 percent of the company’s total revenue last year, while its non-PC products, including smartphones and wireless speakers, contributed between 20 percent and 25 percent, Huang said.
Huang said he expects revenue contribution from PC-related products to gradually fall below 60 percent of total revenue.
Inventec shares rose 0.21 percent to close at NT$23.40 in Taipei trading yesterday, outpacing the TAIEX, which lost 0.27 percent.