Although tablets are usually seen as a more direct replacement of just the netbook, the world’s number one ODM (original design manufacturer) for notebooks has taken a significant knock in profits in its first quarter year on year results.
Net income came to $120.8 million in the first quarter of 2011, as compared to $295.1 million in the same period last year, and $159 million the previous year, with the cannibalisation of the notebook market symptomatic of a real sea change towards tablet production and away from more traditional devices. Figures are in US dollars.
And clearly this is bad news for Compal, a firm which accounts for 95 percent of notebooks worldwide.
“We believe cannibalisation from tablets is there and it’s really a problem for the notebook market,” Chen reportedly said at a stock exchange filing yesterday.
So while Chen expects a ten percent increase in shipments of notebooks in the next quarter shipment expectations for the rest of the year have fallen from a forecasted 55 million units to 48 million.
One of the reasons for the drop in predicted shipments of notebooks is due to a large change in orders from one of its main clients Acer, due to a reported change of personnel.
In other markets the firm hopes to hit predictions of shipping 3.8 million tablets, LCD TVs and two million all-in-one computers during this year.