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March 27, 2017

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Asus says PC sales may drop 20% in Q1

TAIPEI, Taiwan -- Taiwan-based tech giant Asustek Computer Inc. (華碩) said it expected to see PC sales drop between 15 and 20 percent this quarter due to seasonal factors.

In a shareholders meeting Wednesday, Asus CEO Jerry Shen (沈振來) said the PC industry continued to face huge challenges and evolving with the times was inevitable.

Shen said he hoped that the firm's top three product lines — the Zenbook, their gaming products and the hybrid tablet-notebook 2-in-1 — would boost this year's revenue by 40 percent.

The three product lines account for more than half of the company's current revenue.

Asus said that in 2016, it saw year-on-year growth of 12 percent for annual revenue of NT$466.8 billion, with earnings per share (EPS) of NT$25.9 — an improvement from the previous year's EPS of NT$23.

In the fourth quarter, the group gained approximately NT$126.4 billion in revenue — surpassing their quarterly goal of NT$100 billion to NT$110 billion because of better-than-expected sales of laptops and handsets.

However, in addition to expecting weaker PC sales, the firm holds a gloomy outlook for their mobile and electronic component product segments for the first quarter this year, expecting a 10 to 15 percent drop in mobile profits and a slight 5 percent decline in electronic components.

EU Antitrust Probe

When asked for an update on developments since the tech company came under scrutiny of the European Union's regulators for a suspected breach of competition rules, Shen said Asus would fully cooperate with investigations.

He stressed that Asus placed integrity above all else when doing business and would respect the regulations of different countries and regions. Chief Financial Officer Nick Wu (吳長榮) added that investigations were still in their early stages and the formal inspection would not begin until a few months later.

EU regulators will focus on examining e-commerce retail channels in two or three select countries, Wu said. "(We) do not find it suitable to make judgments at this point, but Asus most definitely is a responsible and honest company, and (we) will let the public know as soon as there is any progress made in the investigations."

On Feb. 2, the European Commission launched three separate investigations targeting 15 companies suspected of violating antitrust rules, in order to tackle barriers to cross-border online trade and prevalent "geo-blocking" — unfairly restricting offers and cheap prices based on a shopper's location — within the EU.

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