Quanta Computer on May 3 firmly denied reports that the company will lay off 10-20% of employees in June, adding that a number of employees voluntarily resigned due to merging a business office in Hsinchu, northern Taiwan into its headquarters in late 2015 and corporate reorganization in the first quarter of 2016.

Quanta currently supplies 30% of worldwide notebook shipments, but has seen its orders dropping. Hewlett-Packard (HP) and Apple are the two major clients of Quanta.

Quanta still sees stable orders from HP and is expected to enjoy growing shipments in the second half with new MacBook Air shipments starting at the end of the second quarter.

With the notebook market shrinking, notebook ODMs have been merging their resources and production lines. In addition to merging plants in China, some have also turned excess capacity to manufacture products such as servers, handheld devices and Internet of Things (IoT) devices.

As for staff, most ODMs have also stopped hiring new R&D technicians and sales personnel for their notebook businesses.

However, ODMs continue to expand their non-notebook operations. Quanta's cloud computing department already has over 1,000 employees and is continuing to hire new talent, while Compal Electronics, Wistron and Inventec have also been shifting resources and personnel from the notebook business to non-notebook ones.

Digitimes Research's latest report noted that worldwide notebook shipments dropped 13.6% on year to reach only 32.46 million units in the first quarter, the lowest since the first quarter of 2009.