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September 21, 2017

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Asustek forecasts its phone shipments to double in 2015-'16

TAIPEI, Taiwan -- Asustek Computer Inc. (華碩電腦) on Tuesday forecast the company's smartphone shipments to reach between 5-10 million this year, adding that annual shipments are likely to double in 2015 and 2016.

At the quarterly institutional investors' meeting held yesterday in Taipei, Asustek Chief Executive Officer Jerry Shen (沈振來) said Padfone and ZenFone — Asustek's new premium and mid-range flagship models — are the two major money makers for the company's smartphone lines.

These two models will sell in Taiwan and Association of Southeast Asian Nations (ASEAN), as well as Brazil, Russia, India and China (BRIC), Shen said.

H1 Shipments to Reach 2 Million

Shen told local media that shipments of Asustek's smartphones will hit two million in the first half and run to 5-10 million at year-end.

He also estimated Asustek will ship 1.5 million smartphones in the April-June quarter, seven times higher than the 200,000 units shipped in the first quarter.

Due to a low base period in 2014, Asustek expects to see its annual smartphone shipments to post 100-percent growth in 2015. The 2016 smartphone shipment goal is set at 40 million units, double what it sold a year earlier.

Local media also reported that Asustek revealed first-quarter earnings per share (EPS) of NT$5.87 (US$0.19) on Wednesday, lower than analysts had expected.

According to the Central News Agency (CNA), UBS Securities predicted in a report before the earnings announcement that Asustek's EPS for the January-March period would be NT$6.09, and Citigroup Inc. projected first-quarter EPS of NT$6.89.

The Taiwanese PC brand's consolidated revenue in the traditionally slow quarter for electronics makers totaled NT$100.27 billion, down 16 percent from the previous quarter and down 5 percent from a year earlier.

Asustek also offered a mixed picture for second-quarter shipments. The company expects shipments of notebooks and hybrid devices to fall to 4.6 million units from 4.9 million units in the first quarter and tablet shipments to rise to 2.8 million units from 2.1 million units in the January-March quarter.

Asustek Shares Slip 0.45%

Asustek shares closed down 0.45 percent at NT$331.5 Wednesday in Taipei trading before the earnings announcement.

Shen earlier predicted the company's branded operation revenue to further grow and the operating profit margin to remain at 4.5 percent this year.

Asustek's branded operation saw revenue hit a record high of NT$421.3 billion (US$14 billion) last year after spinning it off from its contract-manufacturing service in 2011.

Nevertheless, some industry executives feel the margin can be better for a branded supplier regardless of the reality that the PC market, in which Asustek is still a big player, has stagnated for many years due to the rise of mobile computing devices.

This year, smartphones are set to be one of the company's profit makers this year, with the company predicting its smartphone business to begin making money this year with its plan to ship five million smartphones, after losing NT$1 billion last year.

With laptops to be another moneymaking business this year, Asus recently unwrapped the C200 and C300, two new chromebook models. The new chromebooks come in two sizes and promise battery life of 10 hours, according to foreign news wires.

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