Pegatron Snaps Up Apple's Contract Order for iPhone 4S

Oct 18, 2011 Ι Industry In-Focus Ι Electronics and Computers Ι By Steve Chuang, CENS
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Taipei, Oct. 18, 2011 (CENS)--The Taiwan-based Pegatron Corp., a contract manufacturer of electronics, is reported to have garnered Apple Inc.'s big order for 15 million units of iPhone 4S, which will contribute considerably to the manufacturer's revenue in the fourth quarter of this year, according to industry sources.

The sources indicated that Pegatron has been filling the order, and is estimated to finish the fourth quarter with shipment of between 2 million and 2.5 million units, which will contribute nearly 10% to its overall iPhone shipment in the quarter.

Apple's placement of the contract order with Pegatron is of great significance to the industry, as this means Hon Hai Precision's exclusive status in the supply chain of mainstream iPhone models has been broken. In the future, Pegatron is even likely to become part of Apple's supply chain of iPad 3 and iPhone 5, eating into Hon Hai Precision's profits, noted institutional investors.

In fact, Pegatron's ambition to vie for Apple's contract orders for iPad 3 has been shown in its recent output expansion for metal PC housings. Institutional investors indicated that the effort will start to pay off next year, when the company's capacity of the PC components will double, making the firm more competitive in vying for iPad 3 contract orders.

Expansion of metal PC housings is also helpful to the company in capturing business opportunities brought by Ultrabook PCs. The company has already garnered contract orders for Ultrabook PCs from Asus and Lenovo, confirming that its production lines have been fully booked for such products till next year.

Fueled by brisk shipment growths of PCs, consumer electronics and communication devices, the company's combined revenue for September soared 15.2% monthly to NT$53.776 billion, a single-month high in two years. Finishing the third quarter with aggregate revenue of NT$152.1 billion for a 48% growth from a quarter ago, the company is likely to turn profitable in the quarter.
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