Universal Scientific Industrial (USI) has quietly been phasing out its motherboard business, after losing orders from its largest contract customer Lenovo, according to sources from motherboard players. The sources also said Lenovo is accelerating its outsourcing of notebook production in a move to lower production costs.
USI confirmed the report and said that the company's strong growth in communication and network storage product lines can help cover the lost motherboard orders and it is maintaining its 2010 revenues at the same level as it had in 2009.
Since Lenovo has recently increased the proportion of its notebook production outsourced to ODMs from 80% to 95% and left only 5% of its productions in house, most of the related component supplies, including motherboards have already been shifted to Compal Electronics, Wistron and Quanta Computer.
USI already quit its Abit brand motherboard business and now is quitting the motherboard OEM/ODM market completely, so the company has seen the proportion of its revenues coming computer and peripherals business drop significantly since April.
USI
Photo: CJ Liu, Digitimes file photo
Article translated by Joseph Tsai
