Pegatron Technology has announced its financial results for the second quarter and expects its third-quarter revenues to see a 5-10% sequential drop. However, with its shipments to the non-PC segment entering the peak season, the company expects its revenues from consumer and communication product businesses to enjoy a sequential increase of 40-50% in the third quarter with a better operating margin than second quarter's 1.3%.

　　Pegatron Technology has announced consolidated revenues of NT$212.23 billion (US$7.1 billion) for the second quarter, down 2.5% sequentially and 3.2% on year. Gross margin reached 4.5%, down 1pp on quarter, while net profits totaled NT$2.51 billion with earnings per share (EPS) of NT$0.61. The drop in gross margin was due to a change in the company's product mix and the fact that new products still have not yet entered mass production.

　　Pegatron also reported consolidated revenues of NT$429.82 billion for the first half, up 9.9% on year with a gross margin at 5%, up 0.7pp on year. Operating net profits totaled NT$75.5 billion, up 52.6% on year, with the operating margin going up 0.55pp on year to 1.8%. Net profits came to NT$5.97 billion with an EPS of NT$1.62.

　　Pegatron had weaker-than-expected notebook shipments in the first quarter due to production adjustments at its factories, but after completing the adjustments, Pegatron enjoyed a significant shipment growth in the second quarter.

　　With the launch of the Windows 8.1 and seasonal factors influencing the PC industry, Pegatron expects its fourth-quarter notebook shipments to grow slightly or stay flat on quarter.

　　Pegatron has also adjusted its notebook shipment ratio forecast for the first and second halves of 2013 from 40:60 originally to 45:55 and expects touchscreen models to only account for 15% of total notebook shipments in the second half, up slightly from 10% currently.

　　At the same time, Pegatron is also expected to benefit from Apple's entry-level iPhone shipments starting August. The iPhone orders are expected to reach their shipment peak in the fourth quarter, helping Pegatron achieve strong revenue growth in the quarter, according to some market watchers.