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Merrill Lynch cuts PC shipment projection for 2013

2013/04/15 17:14:08

Taipei, April 15 (CNA) Bank of America Merrill Lynch has cut its forecast for global personal computer shipments this year, citing weakening demand across the world.

Global PC shipments are now estimated to drop 9 percent to 317.8 million units in 2013, well below the bank's earlier forecast of a 4 percent decrease, a Merrill Lynch analyst said in a research note dated April 12.

"Overall, we do not expect any strong catalysts in 2013," Robert Cheng, a Taipei-based analyst, wrote in the note.

The revised forecast came on the heels of a preliminary report by research firm International Data Corp. (IDC), which estimated a 13 percent quarterly drop in worldwide PC shipments for the first quarter and a 14 percent year-on-year decrease.

The Q1 data indicated the worst year-on-year contraction since IDC began tracking the PC market quarterly in 1994. It was also the fourth consecutive quarter in which PC shipments registered a year-on-year decline.

In the United States, the annual drop in PC shipments in the first quarter of the year was 13 percent, while in non-U.S. regions it was 14 percent, indicating soft demand across the world, according to IDC.

It said the PC industry's efforts to offer touch capabilities and ultra-slim systems have been hampered by the usual problems of price and component supply, as well as a weak reception of Microsoft Corp.'s new Windows 8 operating system.

Among the world's top five contract notebook makers, Quanta Computer Inc. and Pegatron Corp. of Taiwan had the lowest shipments in the first quarter, while Compal Electronics Inc. outperformed the others on the back of expected strong orders from its main customer Dell Inc., Cheng said.

Taiwanese computer brands Acer Inc. and Asustek Computer Inc. met their own projections for first quarter shipments, thanks to improved momentum in their tablet sales, the analyst said.

Given the lack of catalysts in the PC industry, Cheng recommended the stocks of certain electronics manufacturing services companies, such as Hon Hai Precision Industry Co. and Pegatron, because of their wider customer base.

Cheng also predicted that these companies will start showing improved sales in the second half of 2013.

In the near term, Merrill Lynch also favors companies in the touch and display sectors, including AU Optronics Corp., Innolux Corp., TPK Holding Co. and Tripod Technology Corp., which will likely have a better outlook in the first half of this year, he said.

(By Jeffrey Wu)
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