Handset ODM Compal Communications is expected to see its shipments increase significantly in the fourth quarter of 2012, buoyed by orders from Nokia and Lenovo, as well as other clients in Japan and China, according to industry sources.

Shipments of smartphones to clients in China, Japan and the US will account for 30-40% of Compal's total shipments in the fourth quarter and help the company to reach its goal of shipping a total of 9.6 million smartphones in 2012, the sources noted.

Compal's third-quarter revenues of NT$37.1 billion (US$1.27 billion) represented a decline of 47.5% from the previous quarter as major client Nokia was cutting back orders for the quarter in preparation for the launch of new models, the sources noted.

Despite the low penetration rate in the global market, Compal will continue to focus on the production of Windows Phone 7.5- and Windows Phone 8-based models in 2013, the sources noted.

Nokia is expected to continue marketing its Windows Phone 7.5-based models to maintain its share in emerging markets in 2013, and that the vendor will continue to outsource the low-priced phones to Compal, the sources commented.