Arima Electronics acquires notebook order from eMachines

Taipei, July 9, 2003 (CENS)--Arima Electronics Inc. recently landed an order to supply notebook computers to eMachines, the No. 2 computer retailer in the U.S., enhancing the company's revenue prospects for the second half.

Arima is also expected to win orders from Hewlett-Packard (HP) Co. for delivery in the second half of the year.

Arima recently shifted its marketing efforts to retailers in the United States, Europe and Japan in hope of boosting profits. The company, like many other of its rivals, has been undercutting the competition for a while.

eMachines recently ordered all-in-one notebook computers with 15-inch displays and Advanced Micro Devices microprocessors from Arima. The Taiwan-based Arima began to deliver the computers last quarter.

People familiar with the deal pointed out that eMachines has contracted another Taiwanese supplier, Uniwill Computer Corp., to build notebook computers and First International Computer (FIC) to supply desktop computers.

Arima also supplies tablet PCs to NEC Corp. of Japan.

Arima expects to post higher earnings this year due to its focus on high-margin products. Server computers, personal digital assistants, smart phones and liquid-crystal display (LCD) TVs are among the high-margin products the company plans to produce this year. In the meantime, the company will scale back its notebook computer business to account for 60% of its total revenue, from 90% now.

Arima has reduced its capitalization to NT$11.5 billion (US$330 million at US$1:NT$35) from NT$12.3 billion (US$350 million). The net value of its shares posted at NT$15 in the first quarter this year. The company expects profits to increase this year after two of its reinvested companies go public.

Arima forecast HP to be another major revenue source. The U.S. company is expected to extend contracts with the Arima through the next quarter.