|Bid||51.30 x 0|
|Ask||51.40 x 0|
|Day's Range||51.10 - 51.50|
|52 Week Range||46.75 - 66.40|
|Beta (3Y Monthly)||1.43|
|PE Ratio (TTM)||12.39|
|Earnings Date||Nov 4, 2019 - Nov 9, 2019|
|Forward Dividend & Yield||3.50 (6.85%)|
|1y Target Est||58.90|
(Bloomberg) -- Terms of Trade is a daily newsletter that untangles a world embroiled in trade wars. Sign up here. Even the unseasonable downpour couldn’t dampen the spirits of the executives and officials gathered on the Indonesian island of Batam to cut the ribbon on a new Pegatron Corp factory. The men exchanged jokes as they took shelter under a white canopy, and when company vice chairman Jason Cheng pledged to hire hundreds of locals, the assembled audience erupted in applause.This low-key July ceremony to launch a manufacturing outpost marked a critical first step into Southeast Asia for one of Apple Inc.’s most important suppliers. It also encapsulates a fundamental move of electronics production, set in motion by the escalating U.S.-China trade war, that may hurt the world’s No. 2 economy while enriching Southeast Asia and beyond.“Pegatron, and many more to come, is an opportunity,” Edy Putra Irawady, head of a local agency charged with enticing capital, told the crowd. “Batam has prepared various incentives to chase the opportunity and attract more investment.” Irawady is one of many making preparations for the most profound shift in global manufacturing since the advent of the made-in-China model in the 1980s: its potential dismantling.Trump’s flip-flops on trade, including a backtracking just this week on threats to slap punishing tariffs on $300 billion of goods, are spurring an exodus from China of manufacturers. Some recognize that U.S.-Chinese tensions won’t fade soon, while others are just tired of the uncertainty. In one of the most dramatic responses since Trump first brandished full tariffs, HP laptop-maker Inventec Corp. declared plans to move its entire U.S.-bound laptop operations from China to its home base of Taiwan within months. “The trade war is very painful for us,” President Maurice Wu said.Like Pegatron, the makers of the world’s electronics are increasingly rushing out of the way of Trump-administration tariffs on Chinese-made goods. Server motherboard makers for Google and Amazon.com Inc. are already shifting to Taiwan. Even Apple Inc., whose gargantuan Chinese production machine hires more people than any other private employer, is testing the waters. GoerTek Inc., for one, is trying out production of AirPods in Vietnam, people familiar said. A GoerTek representative declined to comment on the specifics of its Apple business but said the company will gradually make several products in both China and Vietnam.The U.S. president’s campaign of tariffs and export restrictions against Chinese champions like Huawei Technologies Co. threatens to up-end the production of the world’s electronics, from iPhones and laptops to 4K televisions. The decades-old supply chain is starting to split in two: one beyond China’s borders that serves American concerns, and another within the world’s most populous country that caters to local consumers.It’s something Foxconn’s billionaire founder, Terry Gou, calls “G2” or the emergence of two competing global standards created by China and the U.S. Gou -- who as Apple’s main production partner helped pioneer the made-in-China model -- has volunteered to “help the U.S. reshape a new supply chain.” Young Liu, Gou’s successor, told shareholders the company could make every U.S.-bound iPhone outside of China if it had to.While U.S.-based companies seek alternatives beyond mainland China, their counterparts in China likewise are “de-Americanizing” their supply chains, reducing their reliance on American core technology for fear they will suffer the same fate as Huawei. The company is now hunting for Asian and European component makers to reduce its dependence on U.S. firms from Google to Micron.In August, Huawei approved Taiwan-based wifi module maker RichWave Technology Corp. to supply parts that U.S. wireless semiconductor company Skyworks used to provide. Analysts including Kevin Chen of Taipei-based President Capital Management say Huawei is increasingly looking to Taiwan’s Win Semiconductors to manufacture radio frequency chips previously supplied by Skyworks and compatriot integrated circuits maker Qorvo.“Both U.S. and Chinese companies are diversifying their supply chains due to similar reasons -- to mitigate geopolitical risks,” said Gordon Sun, director of the Taiwan Institute of Economic Research’s Macroeconomic Forecasting Center.Mere months ago, it seemed as if China had a virtual lock on the business of making the world’s electronics -- an arrangement that benefited not just tech juggernauts from Dell Technologies Inc. to HP Inc. but also ensured jobs for millions across the country and fostered the growth of a massive domestic manufacturing industry.While there’s little chance that China will fully cede its mantle as the world’s electronics workshop anytime soon, the outward-bound trend is accelerating. That’s because the household names that built the technology industry’s global supply chain aren’t waiting to see how the conflict turns out.Delta Electronics Inc., which makes power and cooling components for clients like Microsoft Corp. and Huawei, is moving some production back to its home base of Taiwan and to Thailand. It’s also taking the unusual step of building three to four plants in India, responding to Prime Minister Narendra Modi’s Make-in-India program.Modi’s efforts to drive foreign companies to source components locally is showing success. Foxconn will start to churn out iPhones in the country this year after its print circuit board affiliate and Apple supplier Zhen Ding Technology Holding announced plans to invest there late last year. Luxshare Precision Industry Co., another Apple supplier, is considering moving some production of cables and connectors to India as well, according to people familiar, with one saying Apple made the request to the Chinese company. Calls to a number listed on the Luxshare website went unanswered and the company did not respond to an email seeking comment. Chinese smartphone brands including Huawei, Oppo and Xiaomi are all making handsets in India.It’s not just U.S.-China tension that keeps supply chain executives up at night. Politically motivated trade protectionism may be spreading. Japanese curbs on the export of vital chip- and display-making materials to South Korea -- the latest manifestation of lingering tensions stretching back to colonization by Tokyo and World War II -- threaten to further splinter the industry. If unresolved, that dispute may hinder efforts to sate the enormous appetites of Samsung Electronics Co. and SK Hynix Inc., expediting a production migration from Japan.Any shift won’t happen overnight. While moving assembly operations is unlike relocating a chip fabrication facility -- arguably the most expensive type of plant at $10 billion or more to set up from scratch -- the cost can run into millions of dollars and entails a plethora of issues from licenses to new regulations and hiring. That’s an additional burden that manufacturers with single-digit margins can ill afford.“Our net profit margin stands at a mere 1.4% in the first quarter. The tariffs are 25%. We simply cannot help our customers absorb those,” Quanta Computer Chairman Barry Lam said in May when talking about potential production shift and tariff impact.Despite Trump’s proclamations, the U.S. won’t get many of the jobs moving out of China. Taiwan and Southeast Asia are first in line to absorb any manufacturing exodus. Vietnam has become the largest beneficiary of the trade war in the 12-month period beginning in the first quarter of 2018, gaining 7.9% of GDP from trade diversion, Nomura said in a June 3 note.Batam, once a poverty-stricken corner of the Indonesian archipelago, is on the cusp of a boom thanks to abundant cheap labor and quick access to the adjacent trading hub of Singapore. Pegatron has poured $40 million into its newest Indonesian plant, which will produce networking gear for the U.S. market. It’s pledging to grow the workforce there from 40 people to as many as 1,800 eventually.“We’re very determined to invest more,” said Pegatron’s Cheng.\--With assistance from Gao Yuan, Arys Aditya and Adrian Leung.To contact the reporter on this story: Debby Wu in Taipei at firstname.lastname@example.orgTo contact the editors responsible for this story: Edwin Chan at email@example.com, Colum Murphy, Peter ElstromFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
(Bloomberg) -- Apple Inc.’s suppliers are preparing to produce components for up to 75 million new iPhones in 2019’s second half, roughly the same number as a year earlier, according to people familiar with the matter.The volumes planned for the next iPhone launch cycle would signal steady demand for the company’s most important product, despite U.S.-China trade tensions and a decline in the overall smartphone market. The Cupertino, California-based technology giant stopped divulging iPhone shipment numbers in the holiday quarter last year as unit growth turned negative and started providing metrics to highlight the growth of services such as Apple Music. Analysts estimate Apple sold 70 million to 80 million new iPhones in the second half of last year.The company’s Asian suppliers are gearing up to produce components for three new iPhone models to meet holiday-season demand, the people said, asking not to be identified citing internal estimates. The U.S. company’s Asian partners could ramp production up to 80 million new phones if needed, one of the people said. Main iPhone assembler Foxconn Technology Group has stepped up hiring in Shenzhen and is offering staff about 10% more than a year ago to secure a peak-period workforce, another person familiar with the matter said.The iPhone assembler Pegatron Corp. added to gains and closed 2.3% higher, while lens maker Largan Precision Co. rose 2.6%. Taiwan Semiconductor Manufacturing Co. pared earlier losses and closed unchanged.Apple has announced new iPhones each September since 2012 and the new models typically go on sale in the final weeks of that month. The company reports third quarter earnings on July 30, and the firm’s guidance could indicate its expectations for iPhone sales at the end of the fourth quarter ending in September. Apple still provides iPhone revenue figures, with the company generating $52 billion from iPhones last holiday quarter, a 15% decline, and $37 billion from new iPhones in the last fourth quarter, a 27% increase. Those numbers, however, include a mix of both last year’s new models and earlier versions of the iPhone.Jeff Pu at GF Securities estimates that shipments of newly released iPhones will rise to 74 million in the second half, up about 7% from his estimate of 69 million last year, while TF International analyst Ming-Chi Kuo forecast that Apple would sell 75 million to 80 million new iPhones in the second half of 2018. This year’s volumes may signal stabilization after a year of uncertainty, though that’s a far cry from the double-digit growth numbers of years past.Of course, the fact that Apple suppliers plan to produce parts for 75 million new iPhones doesn’t necessarily mean the company will sell that many. Apple will assess sales after launch and the total shipments may not reach that mark. The company declined to comment.Apple is struggling with soft smartphone demand as people take longer to replace their gadgets and Chinese rivals like Huawei Technologies Co. grab market share. The trade war is also denting Chinese economic growth while souring consumers there on American brands. Analysts have been betting on a 13.3% drop in iPhone shipments to roughly 189 million in fiscal 2019, according to average projections compiled by Bloomberg.“Apple’s growth has become more cyclical and slowed along with the global smartphone market, leaving it dependent on iPhone upgrades to drive sales,” Bloomberg Intelligence analysts John Butler and Boyoung Kim said. “Apple’s inability to raise iPhone prices much higher is constraining growth. Weakness in China due to competition and the trade war with the U.S. remains an issue.”While Apple is relying on services to take up the slack, sales of the gadget remain its largest revenue driver and the U.S. company needs to get the latest devices into the hands of its users so they can actually download and subscribe to new services like the upcoming Apple Card, Apple Arcade gaming service, and Apple TV+, a Netflix rival.The major attraction in this year’s models lies in enhanced cameras: the two high-end models to replace the iPhone XS and iPhone XS Max will include three back cameras, up from two, and a successor to the iPhone XR will include a second back camera. The third camera will serve as an additional ultra-wide lens, Bloomberg News reported in January, allowing the phone to automatically repair parts of an image that may be initially chopped out of a frame. It will also enable a wider range of zoom. All three new models will also include faster A13 processors built by TSMC, Bloomberg News reported in May.Beyond the additional rear cameras, the new iPhone models will look similar to the 2018 versions, which looked like the 2017 iPhone X. Apple is planning a more extensive revamp of the iPhone with an updated design, 5G connectivity, and new augmented reality cameras for 2020, Bloomberg has also reported.Read more: Apple’s 2019 and 2020 iPhone and iPad PlansWall Street sentiment on Apple may be starting to brighten somewhat after a prolonged period of investor-pessimism. Morgan Stanley boosted its target price on the stock this week, days after another firm upgraded the shares. Apple may benefit from a U.S. ban on the sale of American technology to Huawei, not to mention Japanese exports curbs to Korea that threaten Samsung Electronics Co. Apple’s main chipmaking partner, TSMC, also helped allay fears of a protracted industry slump when it projected current-quarter revenue ahead of estimates. Longer term, investors hope Apple can rejuvenate its most iconic gadget.(Add share price changes in fourth paragraph.)To contact the reporters on this story: Debby Wu in Taipei at firstname.lastname@example.org;Gao Yuan in Beijing at email@example.com;Mark Gurman in San Francisco at firstname.lastname@example.orgTo contact the editors responsible for this story: Edwin Chan at email@example.com, Peter ElstromFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
(Bloomberg) -- Terms of Trade is a coming daily newsletter that untangles a world embroiled in trade wars. Sign up here. Apple Inc. has asked its largest suppliers to consider the costs of shifting 15% to 30% of its output from China to Southeast Asia in a dramatic shake-up of its production chain, the Nikkei reported.The U.S. tech giant asked “major suppliers” to evaluate the feasibility of such a migration, the newspaper cited multiple sources as saying. Those included iPhone assemblers Foxconn Technology Group, Pegatron Corp. and Wistron Corp., MacBook maker Quanta Computer Inc., iPad maker Compal Electronics Inc. and AirPod makers Inventec Corp., Luxshare-ICT and GoerTek Inc., Nikkei cited them as saying.China is a crucial cog in Apple’s business, the origin of most of its iPhones and iPads as well as its largest international market. But President Donald Trump has threatened Beijing with new tariffs on about $300 billion worth of Chinese goods, an act that would escalate tensions while levying a punitive tax on Apple’s most profitable product. Company spokeswoman Wei Gu didn’t respond to a request for comment.Two major Apple suppliers pushed back against the Nikkei report. The U.S. company has not asked for cost estimates for shifting production out of the world’s No. 2 economy, although suppliers are running the numbers on their own given the trade dispute, said one person familiar with the matter, asking not to be identified discussing internal deliberations. Another supplier said it too had not gotten such a request from Apple and that the Cupertino, California-based company had resisted a proposed production shift to Southeast Asia.Apple does have a backup plan if the U.S.-China trade war gets out of hand: Primary manufacturing partner Hon Hai Precision Industry Co. has said it has enough capacity to make all U.S.-bound iPhones outside of China if necessary, Bloomberg News reported last week.The Taiwanese contract manufacturer now makes most of the smartphones in the Chinese mainland and is the country’s largest private employer. Hon Hai, known also as Foxconn, has said Apple has not given instructions to move production but it is capable of moving lines elsewhere according to customers’ needs.Apple hasn’t set a deadline for the suppliers to finalize their business proposals, but is working together with them to consider alternative locations, the Nikkei said. Any move would be a long-term process, it cited its sources as saying.Beyond Apple’s partners, the army of Taiwanese companies that make most of the world’s electronics are reconsidering a reliance on the world’s second-largest economy as Washington-Beijing tensions simmer and massive tariffs threaten to wipe out their margins. That in turn is threatening a well-oiled, decades-old supply chain.Taiwan’s largest corporations form a crucial link in the global tech industry, assembling devices from sprawling Chinese production bases that the likes of HP Inc. and Dell then slap their labels on. That may start to change if tariffs escalate, an outcome now in the balance as Washington and Beijing spar over a trade deal.Apple is an outsized figure in that negotiation. The high-end iPhone, which accounted for more than 60% of the company’s 2018 revenue, drives millions of jobs across China as well as a plethora of different industries from retail to electronics. The country is also a major consumer market in its own right, yielding nearly 20% of last year’s revenue -- weakness there pushed Apple to cut its sales forecast in January.“Twenty-five percent of our production capacity is outside of China and we can help Apple respond to its needs in the U.S. market,” Hon Hai board nominee and semiconductor division chief Young Liu told an investor briefing in Taipei last week. “We have enough capacity to meet Apple’s demand.”(Updates with a source’s comments from the second parapraph.)To contact the reporter on this story: Debby Wu in Taipei at firstname.lastname@example.orgTo contact the editors responsible for this story: Peter Elstrom at email@example.com, Edwin ChanFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Taiwan's Pegatron has signed a letter of intent stating it intends to invest 10-15 trillion rupiah ($695 million to $1 billion) in an Indonesian factory to assemble "chips for Apple smartphones", Indonesia's deputy industry minister said on Tuesday. Pegatron plans to assemble the phone chips in partnership with Indonesian electronics company PT Sat Nusapersada at a factory on the island of Batam, Deputy Minister Warsito Ignatius told Reuters. Pegatron declined to comment.
May 7 (Reuters) - Pegatron Corp: * SAYS Q1 CONSOLIDATED REVENUE T$294.1 BILLION ($9.52 billion), NET PROFIT AT T$1.33 BILLION Source text on Eikon: Further company coverage: ($1 = 30.8980 Taiwan dollars) ...
March 14 (Reuters) - Pegatron Corp: * SAYS 2018 NET PROFIT AT T$11.1 BILLION ($359.14 million), CONSOLIDATED REVENUE AT T$1,340 BILLION Source text for Eikon: Further company coverage: ($1 = 30.9070 Taiwan ...
March 11 (Reuters) - Pegatron Corp: * SAYS FEB SALES UP 6.3 PERCENT Y/Y Source text in Chinese: https://bit.ly/29I3zX1 Further company coverage: (Reporting by Hong Kong newsroom)
* PREVIOUS TRADING SESSION MOVES: * SSEC +1.1 pct, CSI300 +1.2 pct, HSI +0.5 pct * Shanghai- HK daily quota used 6.7 pct * HK- Shenzhen Connect daily quota used 8.8 pct, Shenzhen- HK daily quota ...
March 4 (Reuters) - Pegatron Corp: * SAYS UNIT PROTEK (SHANGHAI) LTD BOUGHT 27.7 MILLION SHARES IN LUXSHARE PRECISION INDUSTRY CO LTD FOR T$2.5 BILLION ($81.12 million) ON MAR 4 Source text for Eikon: ...
Feb 15 (Reuters) - Pegatron Corp: * SAYS JAN SALES UP 1.3 PERCENT Y/Y Source text in Chinese: http://mops.twse.com.tw/mops/web/index Further company coverage: (Reporting by Hong Kong newsroom)
(Bloomberg) -- Apple Inc.’s main assemblers are shifting more output to India and Southeast Asia as trade tensions threaten to escalate costs in their longstanding production base of China.
Jan 10 (Reuters) - Pegatron Corp: * SAYS DEC SALES UP 18.6 PERCENT Y/Y Source text in Chinese: https://bit.ly/29I3zX1 Further company coverage: (Reporting by Hong Kong newsroom)
Apple asked its suppliers late last month to produce fewer-than-planned units of its XS, XS Max and XR models, the Nikkei reported, citing sources with knowledge of the request. The request was made before Apple announced its forecast cut, the Nikkei said. The bleaker sales outlook, which Apple attributed to weak China demand, triggered a broad sell-off in global stock markets.
Apple Inc, which slashed its quarterly sales forecast last week, has reduced planned production for its three new iPhone models by about 10 percent for the January-March quarter, the Nikkei Asian Review reported on Wednesday. Many analysts and consumers have said the new iPhones are overpriced. Apple asked its suppliers late last month to produce fewer-than-planned units of its XS, XS Max and XR models, the Nikkei reported, citing sources with knowledge of the request.
The lead attorney for the group of Apple Inc (AAPL.O) device assemblers seeking at least $9 billion (7 billion pounds) in damages from Qualcomm Inc (QCOM.O) said on Sunday the contract manufacturers are not in settlement talks with the mobile chip supplier and are "gearing up and heading towards the trial" in April. The conflict is but one aspect of the global legal battle between regulators, Apple and Qualcomm, which supplies modem chips that help phones connect to wireless data networks. Last week, Qualcomm secured a preliminary victory in a patent lawsuit in China that would have banned sales of some Apple iPhones there.
Shares of Apple have fallen more than a quarter since October on concern that iPhone sales are slowing, a prospect that’s been exacerbated by the threat of U.S. tariffs on devices made in China. Across a collection of Taiwanese suppliers, including component makers, November sales climbed 9.3 percent from a year earlier, according to data compiled by Bloomberg News. Taiwan requires companies to report revenue monthly, giving the market unique mid-quarter insight into the hardware supply chain. At Hon Hai Precision Industry Co., the flagship of Foxconn Technology Group, combined October and November sales grew 12.9 percent, while Pegatron Corp. posted a 25 percent uptick.
Taiwan's Foxconn posted a weaker than expected rise in quarterly profit amid warning signs from key customer Apple Inc and its global suppliers that demand for iPhones could be softening. Foxconn, formally known as Hon Hai Precision Industry Co Ltd, reported net profit of T$24.88 billion ($805.52 million)for the third quarter on Tuesday, 12 percent short of analyst expectations. While this was the biggest quarterly profit the company has posted this year and came in 18 percent above the year-earlier results, it was below a mean estimate of T$28.26 billion ($916.85 million) from nine analysts, according to I/B/E/S data from Refinitiv.
Shares of some major Apple suppliers fell in Asian trading Tuesday — some to multi-year lows — after the iPhone maker's stock plunged on concerns about customer demand.
TAIPEI/SEOUL (Reuters) - Shares in Asian suppliers and assemblers for Apple Inc fell on Tuesday after several component makers warned of weaker than expected results, leading some market watchers to call the peak for iPhones in several key markets. Following a poor forecast earlier this month, analysts and investors voiced concern over the state of Apple's business, contributing to growing worries that iPhone sales were stagnating and could hurt suppliers. Fresh warnings on Monday from screen maker Japan Display Inc, British chipmaker IQE Plc and Lumentum Holdings Inc, the main supplier of the Face ID technology in the latest generation of iPhones, hurt technology stocks in Asia on Tuesday.
Nov 12 (Reuters) - Pegatron Corp: * SAYS Q3 NET PROFIT AT T$2.8 BILLION ($90.71 million) VERSUS T$3.6 BILLION YEAR EARLIER Source text in Chinese: https://bit.ly/2qHWQoh Further company coverage: ($1 = ...