Compal Electronics has announced consolidated revenues of NT$172.81 billion (US$5.77 billion) for the third quarter, down 2% sequentially and 19% on year. The company has recently reduced its notebook shipment forecast for 2011 due to the impact on hard drive supply from the Thailand flooding, and there is a chance that it may further lower the goal.
Compal president Ray Chen pointed out that the Thailand flooding has seriously impacted the hard drive supply and will affect the company's notebook shipments in the fourth quarter and even in January 2012. Compal's latest update of its forecast puts 2011 notebook shipments at 40-42 million units and 46-48 million units in 2012.
Compal's net profit for the third quarter reached NT$2.17 billion, down 32% sequentially and 43% on year, with earning per share (EPS) coming to only NT$0.49, lower than the NT$0.75 in the second.
As for other product lines, Compal's LCD TV shipments will reach 5.5 million units in 2011 - lower than its original forecast of eight million units - and 6.5-7 million units in 2012.
In 2012, Compal's netbook shipment proportion will drop below 10% with ultrabooks to account for 15-20%. The market for tablet PCs will reach 50-55 million units in 2012, but sales of Android-based tablet PCs have not been as strong as expected.
Hard drives are usually purchased by brand vendors. Therefore, hard drive prices may rise because of the shortage, but it is unlikely to impact notebook ODM's gross margin. But the shortage will be on their shipments.
The hard drive shortage may last into January 2012, but at that time factories in China will go on holiday during Lunar New Year, reduing demand for hard drives.
As for its joint venture with Lenovo, the new plants will not start mass production until 2013. Its plants in Chongqing, China already started mass production in July with monthly shipments of 300,000-400,000 units, while the plants in Chengdu, China will start production in small volume in December, and ramp up to volume production in 2012. Combined shipments from the plants in Chongqing and Chengdu will account for 20-25% of the company's total volume in 2012.
Source:digitimes