ASUS held a corporate briefing on the 10th to explain the operating overview of the third quarter of 2022, with revenue of 132.935 billion yuan and earnings per share of 8.3 yuan; the amount of inventory has dropped from 206.2 billion yuan in the previous quarter to about 174.5 billion yuan, The reduction of about 31.7 billion yuan is slightly ahead of the target.
ASUS’ third-quarter revenue was 132.935 billion yuan, an annual increase of 2%, a quarterly increase of 15%, and a net profit after tax of 6.189 billion yuan, a 45% annual decrease and a quarterly increase of 226%. The EPS of 8.3 yuan was better than the previous quarter’s 2.6 yuan but lower than the 15.3 yuan in the same period last year, the gross profit margin also fell from 18.6% in the same period last year to 11.6%.
The outside world is concerned about the progress of ASUS’s inventory depletion. The inventory amount has dropped from 206.193 billion yuan in the previous quarter to 174.506 billion yuan at the end of the third quarter, a quarter-on-quarter decrease of 15%, and the inventory turnover days have also dropped from 180 days to 148 days. Hu Shubin, co-CEO of ASUS, pointed out that due to the continuous close cooperation with the upstream supply chain and downstream channels, the amount of inventory has dropped by about 31.7 billion yuan, and it is hoped that it will drop by another 20 billion to 30 billion yuan in the fourth quarter. He revealed that the current inventory level of the overall market is about twice as high as before the epidemic, and it may take until the first half of 2023 to recover to a healthy state. Everyone is working hard; it is observed that ASUS has the opportunity to achieve this ahead of schedule, such as board products, which are expected to be available in the fourth quarter. Just restore health, but the general environment is changing rapidly, so ASUS will still closely observe the market dynamics.
Regarding the future PC industry, Hu Shubin also said that in addition to the poor economic environment, the entire industry will continue to adjust inventory, and the scope of influence will be in the first half of 2023. As for the second half of the year, follow-up observations are needed. After the assessment, the PC industry is still in recession in 2023, and the decline in shipments of laptops and desktops falls between high single-digit (late single-digit) to double-digit (double-digit). To this end, ASUS still aims to outperform the overall market by 10%. For example, if the market declines by 10%, ASUS will maintain a flat performance.
The PC industry still faces severe challenges in the face of economic headwinds, so looking forward to the fourth quarter of shipments, ASUS estimates that PC shipments will drop by 15% quarter-on-quarter, while the components part will be due to the launch of new products for motherboards and graphics cards. It is expected to increase by 5% in the season.
On the other hand, ASUS shipped about 800,000 mobile phones last year. This year, due to the lockdown and inflation in the main market in China, the shipment is estimated to be only 600,000 units. The estimates are in line with the forecast and are still within the controllable range.