Wistron expects 60% of 2014 revenues generated from non-notebook products
Aaron Lee, Taipei; Joseph Tsai, DIGITIMES [Friday 20 December 2013]
Wistron expects revenues generated from its notebook ODM business to account for 40% of its total revenues in 2014, down from 45% at the end of 2013, while sales of other product lines including servers, tablets, handheld devices as well as desktops will increase, according to company chairman Simon Lin.

Lin originally expected the 40% goal to be achieved by 2015.

Wistron’s server shipments will enjoy surging growth in 2014 due to Intel’s new server processors, noted Lin. Lin added that Intel has delayed any new server processors causing its server shipments to stagnate over the past two years, but the server industry is now starting to pick up.

Market watchers pointed out that Wistron’s iPhone orders will be the major growth driver for the handheld device segment in 2014. Wistron will ship about 21 million handsets in 2013 and iPhone orders to Wistron are expected to total eight million units in 2014, about 10% of the devices’ total shipments. However, Wistron declined to comment about its orders.

Market watchers pointed out that Lenovo taking back its notebook orders for in-house manufacturing has significantly impacted Wistron’s shipments and the maker is also losing Acer’s orders, as it has been merging business units and is now only assigning one team to handle both Acer and Asustek Computer’s orders.

Commenting on brand vendors gradually turning to place their orders with the top-two ODMs, Lin said that the profitability of orders is now the priority, not volumes, and vendors shifting away orders is no longer as important.

Worldwide notebook shipments are expected to reach 170-180 million units in 2013, dropping to 160-170 million in 2014 and 150 million in 2015. The notebook manufacturing industry’s average gross margins have dropped from a double-digit percentage in the past to only 3-4% currently, and are expected to drop further to only 1-2% in the future, Lin added.

Wistron’s software design subsidiary, Wistron Information Technology & Services, is planning to list on Taiwan’s over-the-counter (OTC) stock market in January 2014. The software designer has recently formed a joint venture with Japan-based OPT and will focus on expanding its presence in North America and Southeast Asia.

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