JPMorgan update on notebooks - Notebook PCs: Murky 3Q visibility on demand, supply and inventory uncertainties

 

JPMorgan update on notebooks - Notebook PCs: Murky 3Q visibility on demand, supply and inventory uncertainties - Our early read for 3Q notebook ODM shipment is a wide range from 10-17% Q/Q, vs. average historical seasonality at up 22% since 2003. We believe corporate demand is picking up, offset by likely weak EU demand. Yet, uncertainty in near-term China demand, severe MOSFET shortage and rising supply chain inventory makes it very hard to predict 3Q shipment growth precisely. Besides, our checks suggest Taiwan notebook ODMs have mostly raised base salary in their Suzhou factory from RMB 1100 to RMB 1300 in the past 2 weeks, the second wage hike this year, which brings the full year wage inflation at ~30%. Notebook ODM stocks may struggle in near term on poor shipment visibility and margin pressure