Taiwan-based handset ODMs Compal Communications and Arima Communications are expected to see a rebound in sales in the fourth quarter of 2012, buoyed by orders from China-based and Japan-based smartphone vendors, respectively, according to industry sources.

Compal and Arima saw revenues decline 47.5% and 46.2%, respectively, in the third quarter, as clients reduced their orders for old models, the sources said. But the makers have begun shipping new models in small volume, the sources added.

Compal has been working to expand the number of its clients and will see the ratio of its shipments to clients in China, Japan and the US account for 30-40% of its total shipments in the fourth quarter, said the sources. A Chinese-language Economic Daily New (EDN) report also indicated orders from China-based smartphone vendors, including Lenovo, Haier and Huawei will help drive up Compal's revenues in the fourth quarter.

Compal posted revenues of NT$2.62 billion (US$89.12 million) for September, up 8.2% sequentially and 342.9% on year. For the first nine months of 2012, revenues amounted to NT$37.11 billion, increasing 404.6% from a year earlier.

Meanwhile, Arima is expected to land more orders from NEC and Sony in the fourth quarter, including NEC's high-end LTE models, the source revealed.

Arima saw revenues slip 5.3% on month and 71.5% on year to NT$886.06 million in September. For the January-September period, revenues totaled 12.95 billion, declining 38.8% from a year earlier.