Compal Electronics reportedly has landed orders from Dell and Lenovo for their Intel Purley platform-based servers for 2017 and the orders are expected to significantly boost Compal's server revenues in the year, according to sources from the upstream supply chain. However, Compal declined to comment on its clients or orders.

The sources pointed out that server vendors usually start a request for quotation for their server products every three years and after its close partnership with clients in the past few years, some brand vendors such as Dell have decided to expand their orders with Compal, while Lenovo also set to place orders with the ODM.

As for other ODMs, Quanta Computer and Wiwynn, a server subsidiary of Wistron, are both aggressively expanding in the datacenter market, while Hewlett-Packard (HP) has established a joint venture with Foxconn Electronics (Hon Hai Precision Industry), looking to lower its costs.

In addition to servers, Dell and Compal also have tight partnership in the notebook business with over 70% of Dell's notebooks manufactured by Compal and Dell is also looking to nurture Compal to become its close partner to compete against its competitors.

Currently, most of Dell's server orders are outsourced to Inventec, Foxconn and Wistron, while Compal only has a small volume of orders. However, Compal president Ray Chen previously noted that the company is expected to see its losses from the server business starting to shrink in 2015 and will turn to profitable operation in 2016.

After acquiring IBM's server business, Lenovo is also expected to increase its cooperation with its close partnership Compal in server outsourcing.

Compal reportedly already received orders from Lenovo for its tower server orders with a shipment volume of around 60,000 units. Dell and Lenovo are currently the second- and third-largest server brand vendor worldwide and new orders are expected to greatly benefit Compal's performance.