24 Hours after we revealed that IT sales had slumped in Australia in the 2nd Quarter technology stocks led by chipmaker Intel took a tumble on US markets last night following reports of a significant decline in demand for personal computer components.
24 Hours after we revealed that IT sales had slumped in Australia in the 2nd Quarter technology stocks led by chipmaker Intel took a tumble on US markets last night following reports of a significant decline in demand for personal computer components.
Analysts said they had seen a dismal start to August for PC-related orders, coupled with piling-up inventories of memory chips. In addition, Taiwanese manufacturers of notebook PCs for major international brands said their shipments were down 20-25 percent in July.
Intel shares fell 4.2 percent to $19.82 following the reports, despite recently reporting record sales.
Among other chipmakers, AMD dropped 6.1 percent to $6.83, Micron Technology fell 4.3 percent to $7.21 and Nvidia lost 3.3 percent to $9.32. Storage chipmaker LSI dropped 6.3 percent to $4.21 while disk-drive maker Seagate fell 6.5 percent to $11.11.
J.P. Morgan analysts said their reports showed that there has been a deterioration in PC product demand coming out of Taiwan as a host of PC companies delayed orders. Morgan said those included Hewlett-Packard and Acer, the world’s two biggest PC makers.
This was backed up by Taiwan newswire DigiTimes which yesterday reported Taiwan-based notebook makers Quanta Computer and Compal Electronics both saw their shipments drop more than 20 percent in July, mainly due to lower-than-expected demand in the US and Europe.
Quanta’s July notebook shipments dropped 25 percent to only 3.6 million units, while Compal shipped 3.2-3.3 million units, down 20 percent.
In addition to the weak demand, Quanta pointed out that clients’ demands to increase transportation by sea to save costs, which required them to bring forward most of their July shipments to June, had also impacted its July shipment.
Quanta said that the company still has good order visibility for August and September. However, the company says it is unlikely to achieve its original goal of 10-20 percent sequential shipment growth in the third quarter.
It has promised to release more details at an investors conference at the end of August.
DigiTimes says Quanta is likely to see only single-digit growth or may stay flat, compared to the shipments of 13.7 million units in the second quarter.
