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Quanta Q2 profit sinks to 10-quarter low (update)

Quanta Q2 profit sinks to 10-quarter low (update)

Taipei, Aug. 14 (CNA) Quanta Computer Inc., the world's largest contract notebook provider, reported Wednesday its lowest quarterly profit over the past 10 quarters because of weak demand for personal computers. Quanta had second-quarter net income of NT$4.02 billion (US$134 million), or NT$1.05 per share, down from net income of NT$4.45 billion and earnings per share of NT$1.16 in the previous quarter. The company's earnings per share fell to the lowest level since posting NT$0.61 in the fourth quarter 2010. Its second-quarter profit was down 9.7 percent from a quarter ago and down 32.9 percent from the same period of last year. Consolidated revenue was NT$191 billion in the April-June quarter, down 3.3 percent from the first quarter, but the company's operating margin continued to improve from 1.3 percent to 1.45 percent over the same period. Quanta's July sales grew to NT$71.7 billion, a month-on-month growth of 5 percent and a record high for the past 12 months. But its fortunes reversed in July, when it shipped only 3.2 million notebooks, a drop of 22 percent from the previous month, reflecting weak demand from vendors. British bank Barclays plc estimated that Quanta will only ship around 10.7 million notebooks for the third quarter, a 4 percent rise from last quarter but a 20 percent drop from the same period last year. "We remain cautious that any sales increase for Quanta is limited due to uninspiring global notebook demand, which continues to be cannibalized by smartphones and tablets," said Kirk Yang, a Barclays analyst in Hong Kong, in a note to clients dated Aug. 13. Quanta is largely being hit by smartphones and tablets branded by Samsung Electronics Co. and Apple Inc., which are made by other manufacturers, Yang said. He rated the stock "equal-weight" with a price target of NT$60. Quanta shares ended 0.16 percent higher at NT$63.8 Wednesday in Taipei before the company announced its latest quarterly results. (By Jeffrey Wu)


Updated : 2021-10-25 13:18 GMT+08:00