TSMC Earnings Soar on AI Demand as Wistron, Pegatron Hit Records

According to the September revenue data for Taiwan's four major contract manufacturers released this month, Wistron and Inventec saw their combined third-quarter revenue hit a record high, reflecting the sustained momentum of AI server demand and end-of-quarter inventory pull. Meanwhile, driven by customer preparation for new device shipments, Pegatron's September revenue surpassed the NT$200 billion mark, setting a new single-month revenue record. Compal achieved year-over-year growth in both monthly and cumulative metrics for September and remains optimistic about the momentum of its non-PC products in the fourth quarter. These figures not only highlight the pivotal position of Taiwan's contract manufacturing industry in the global tech supply chain but also provide key market pulse indicators for investors and industry observers.

The rapid popularization and commercialization of AI technology have become the primary drivers of the global semiconductor market. Since the end of 2023, surging computing demand from cloud service providers, search engines, and large language models has forced server manufacturers to substantially increase production capacity for high-performance CPUs, GPUs, and memory. As major global contract manufacturers for chip packaging and testing, Wistron and Inventec are positioned right at the forefront of this demand wave. In addition to being driven by AI server orders, the revenue growth of the two companies in the third quarter was further boosted by end-of-quarter inventory building. End-of-quarter inventory building refers to customers placing orders ahead of time before the end of the year to secure supply chain security and avoid supply shortages. This practice is particularly common in the tech industry, especially when production cycles for high-demand products like AI servers are relatively long.

As one of the world's largest wafer contract manufacturers, Wistron boasts a broad customer base and advanced process technology. Inventec is renowned for its high-performance computing and AI-related packaging and testing services. The record-breaking combined revenue of the two companies indicates that their strategic deployment in the AI server market has yielded substantial results. In fact, Wistron's revenue growth in the third quarter of 2024 primarily stemmed from high-performance server projects in collaboration with major cloud service providers, while Inventec secured significant orders in AI-related GPU packaging and testing. These orders have not only scaled up the revenue of both companies but also solidified their important positions in the global AI industry chain.

As one of Taiwan's largest electronic component manufacturers, Pegatron saw its September revenue exceed NT$200 billion, setting a new all-time high for single-month revenue. This performance was mainly attributed to accelerated investment by clients during the new product inventory preparation stage. Pegatron's product line covers multiple areas, including smartphone components, notebook computer assemblies, and industrial automation equipment. In recent years, with the rise of 5G, the Internet of Things, and smart manufacturing, the demand for high-quality electronic components has continued to expand. Pegatron's technological advantages and capacity expansion in these fields have enabled it to rapidly meet customer order demands, thereby achieving significant revenue growth. Notably, Pegatron's revenue growth in the third quarter of 2024 came not from a single product category, but from the joint promotion of diversified product lines, demonstrating the resilience and sustainable development potential of its business model.

Compal also achieved year-over-year growth in both monthly and cumulative metrics in September and remains optimistic about the momentum of its non-PC products in the fourth quarter. Compal has long focused on PC manufacturing, but in recent years it has been actively transforming and shifting its focus to non-PC products such as cloud servers, smartphones, and IoT devices. This transformation strategy is particularly crucial against the backdrop of expanding AI demand. Compal's revenue growth primarily originates from collaborative orders with major cloud service providers and its rapid response in the smartphone market. Although the PC market has entered a mature stage, Compal has successfully sought growth points in emerging markets through a diversified product portfolio, laying a solid foundation for the company's future development.

Looking at the aforementioned data overall, the importance of Taiwan's contract manufacturing industry in the global AI supply chain is becoming increasingly prominent. The revenue performances of enterprises such as Wistron, Inventec, Pegatron, and Compal reflect the continuous expansion of AI server demand and the positive impact of end-of-quarter customer inventory pull on industry conditions. For investors, these figures are not merely a reflection of short-term revenue growth, but a signal of the enhanced competitiveness of Taiwan's contract manufacturing industry within the global technology supply chain. For industry policymakers, they underscore the urgent need to strengthen industrial upgrading, elevate process technologies, and enhance supply chain resilience. Moving forward, as AI technology matures further and application scenarios expand, Taiwanese contract manufacturers will continue to play a crucial role, providing a solid hardware foundation for global technological innovation. (Source of facts: Central News Agency)