The Chairman of Taiwan’s Pegatron Corp, Mr. Tong Zixian, said that he expects to see a rise in revenues in the second half of 2015. In fact, he stated that his company is hiring in its factories across China, in expectation of the large number of orders for the Apple iPhone 6s.
He specifically indicated that revenue from assembling communication devices like Apple’s next-generation smartphone will rise sharply in the third and fourth quarters helping loss of revenue in other areas brought on by the current decline in global PC demand.
Responding to this current decline in sales of PC’s worldwide, Pegatron is shifting its focus to mobile devices coinciding with Apple diversifying its supply chain and adding Pegatron to its list of assemblers.
Tung has projected that Pegatron revenues from devices excluding PCs will rise between 20 and 30 percent in the third and fourth quarters of 2015. He is basing this projection on the expectation that iPhones will join the trend toward larger screens despite Apples slight down grade of its third-quarter estimates.
Pegatron is due to assemble up to thirty percent of the first wave of new iPhones and will definitely benefit from their increased presence in the Apple supply chain.
Pegatron did say that the continued decline in the PC market will likely impact their third-quarter laptop shipments by five to ten percent. However, Pegatron’s chief executive, Jason Cheng said recently that “…we believe 2015 should finally see a sustained turnaround for the industry.”
Optimistic sales projections and earnings growth for 2015 are based on projections that the iPhone replacement demand will continue through 2015.
One securities analyst estimated that iPhone assembly will account for close to forty percent of Pegatron’s revenue in the fourth quarter of this year with other Apple products contributing an additional fifteen percent to their revenue stream.
Pegatron diversifying its assembly base to include Apple products has begun to gradually improve their numbers after a decline over a two year period brought about by flat PC sales due in part to the emergence of tablet computers and other smartphone. In any case, Pegatron is confident and well prepared to take on the manufacturing of not only vast numbers of iPhone 6s due to be introduced to fans in September, but other Apple products as well.