Compal mulls possibility of investing in Texas

Taipei, Jan. 14 (CNA) Compal Electronics, Inc., one of the largest contract notebook computer makers in Taiwan, said Tuesday that the U.S. state of Texas is one of its top options as it mulls investing in the United States.

Speaking with reporters on the sidelines of the company's "weiya", or year-end dinner, Compal President Anthony Peter Bonadero said that in response to the return to the White House of Donald Trump, who vowed to raise tariffs during his campaign trail, the company is considering investments in the U.S. market.

Bonadero said Compal is looking at several options in particular states in the southern United States, and Texas is one of the leading options as it is the only state in the U.S. to own an independent electricity grid network.

Compal, which also rolls out artificial intelligence servers, is one of several Taiwanese tech firms to list Texas as their top investment venue option.

Over the weekend, Jack Tsai (蔡枝安), president of Inventec Corp., another AI server maker in Taiwan, also said during the company's 50th anniversary celebration that Texas is a likely choice for its U.S. investments, citing the state's adequate power supply, as well as its relative proximity to Mexico.

As global demand for AI servers largely comes from four mega data centers located in the U.S., Bonadero said, it is no surprise that Compal is thinking about investments in manufacturing in North America over the longer term.

Commenting on Compal's AI server business, Bonadero said the company is expanding its talent pool for the fast-growing server business, while assessing a production expansion plan.

Bonadero said Compal has joined U.S.-based AI chip designer Nvidia Corp.'s "Nvidia MGX" server platform -- a modular reference design supporting diverse applications, from remote visualization to edge supercomputing. The company aims to strengthen its ties with the American AI giant, he added.

Looking ahead to 2025, Bonadero projected AI servers will account for 15-20 percent of the Compal's total sales generated by servers, up from the low single digits (1-3 percent) seen in 2024, while the company will aggressively search for business opportunities created by the Nvidia MGX ecosystem.

While the large language model (LLM), which refers to a type of machine learning model designed for natural language processing tasks such as language generation, is a very important field for AI server development, Bonadero said, Compal will also explore other areas for growth.

In addition, Bonadero said demand for AI PCs is expected to grow in 2025 due to the end of support from Windows 10 in the fourth quarter of the year with replacements of Chromebook computers.

He even forecast demand for AI PCs will rise further in 2026 to account for more than 40 percent of total PC sales.

For his part, Compal Chairman Ray Chen (陳瑞聰) said the company has laid a solid foundation in PC and smart device production, and is looking for a new growth driver, expecting AI servers, automotive electronics and 5G products to become major sources of sales.