ASRock expects its three major product lines - motherboards, industrial PCs (IPCs) and servers - to all enjoy revenue growths in 2019, but its profits for the year are likely to be affected by its graphics card inventory.
ASRock is currently keen on digesting its excess graphics card inventory built during the cryptocurrency mining fad, by offering price cuts, but it will not be cleared out until the second half of the year, according to industry sources.
Worldwide brand motherboard shipments decreased 15% on year in 2018 and only Asustek Computer, Micro-Star International (MSI) and ASRock managed to see flat or slight drops in shipments, while most other players suffered sharp declines.
ASRock shipped around four million motherboards in 2018, while MSI's shipped around six million units.
Although motherboard shipments are expected to continue shrinking in 2019, ASRock is expected to maintain shipments at the similar levels to 2018's, company sources said.
ASRock's IPC subsidiary is expected to turn pofitable in 2019 and will contribute around 15-17% of ASRock's overall revenues, the sources said. Meanwhile, ASRock's server subsidiary is expected to continue achieving small profits in 2019 and will contribute around 10% of ASRock's revenues.
The graphics card business, which ASRock only began in April 2018, was originally expected to become a profit driver in 2018 due to the cryptocurrency mining fad. But the quick dissipation of crytomining demand has left the company with high inventory.
However, the company is still optimistic about AMD's graphics card products and has seen strong sales for its newly released 7nm Radeon VII graphics card priced at US$699. The company is also preparing for the upcoming RX series Navi, scheduled for the third quarter of 2019, according to some market watchers.
The market watchers expects ASRock's revenues to grow 20% on year in 2019, up from NT$10.19 billion (US$328.22 million) in 2018. ASRock had net profits of NT$5.93 billion for 2018, up 26.4% on year with EPS reaching NT$4.91.
Article translated by Joseph Tsai
