Chicony Power Sees Laptop Slowdown, While Communications and AI Server Power Support Q4

Preface

Chicony Power (群電, 6412-TW) held an investor conference on the 4th, describing a mixed outlook across its businesses. The laptop industry is entering its seasonal slowdown earlier than usual as a memory shortage continues to constrain the market. At the same time, the company expects power products outside the laptop segment to play a more important role in supporting operations. In particular, it sees potential strength in communications power and AI server power during the fourth quarter, as new products begin contributing more meaningfully.

This article reviews the company’s reported revenue, the factors affecting laptop demand, and the growth prospects and constraints in its server and communications power businesses. It also explains how new product launches and production adjustments could influence its business mix in the months ahead.

Lazy bag

Chicony Power reported consolidated revenue of 19.23億元 for October and cumulative revenue of 255.64億元 for the first 10 months of the year, down 12.1% year over year. Laptop-related orders have softened as brand customers began adjusting inventories from October and memory shortages continued to affect the industry. By contrast, demand for communications power products is strong, with orders exceeding the company’s original capacity plans. A new-generation home receiver power supply entered mass production in September. Chicony Power is accelerating materials preparation and expanding capacity, targeting communications power revenue growth of multiples compared with both the previous quarter and the same period last year in the fourth quarter. Server power demand also remains strong, although component shortages and limited testing equipment have delayed some customer orders.

Main Body

Chicony Power’s latest business update highlights a divergence between its traditional laptop-related demand and its non-laptop power businesses. The company said the laptop industry is facing a persistent memory shortage that is unlikely to be resolved in the short term. As a result, the market is showing signs of an unusually early seasonal slowdown, with the peak-season performance that customers typically expect becoming less pronounced.

According to the company, laptop brand customers generally prepare inventory from the end of the third quarter into the beginning of the fourth quarter. This year, however, tight semiconductor supply and the need to allocate resources across the supply chain have affected purchasing patterns. Customers began entering the off-season from October and have been adjusting inventories. The resulting near-term order intake and shipment momentum are relatively cautious.

Inventory adjustments can affect manufacturers even when end-market demand has not disappeared. When customers reduce or rebalance stock, they may temporarily place fewer orders while using products already in their supply chains. In this instance, Chicony Power linked weaker month-on-month shipment momentum to PC brand customers bringing forward their inventory adjustments. The company’s comments therefore point to a timing and supply-chain challenge alongside the broader weakness in laptop-related activity.

The revenue figures provide a snapshot of this environment. Chicony Power reported October consolidated revenue of 19.23億元. For the period from January through October, consolidated revenue totaled 255.64億元, representing a 12.1% year-over-year decline. The company attributed the softer October pull-in momentum to PC brand customers starting inventory adjustments earlier. These figures establish the scale of the reported business and the comparison with the prior year, while the company’s outlook emphasizes the potential contribution of non-laptop product lines.

Server power is one such business. Chicony Power said demand in this market remains strong, and new projects continue to be introduced. However, the business has not been immune to supply constraints. Shortages of key components and a lack of testing equipment have affected execution, with some customers’ order schedules pushed back. These delays can shift the timing of shipments even when underlying market demand remains healthy.

The distinction between demand and delivery timing is important to understanding the company’s server outlook. Strong market requirements and a growing pipeline of new projects offer a basis for continued business momentum, but production and testing capacity determine how quickly orders can be fulfilled. Chicony Power described its server power activity as improving steadily as new projects are introduced, while acknowledging that component availability and testing resources remain practical constraints.

Communications power products were described as a more immediate source of strength. The company said demand is active across its product range and that customers continue to add orders. Overall order requirements are substantially above the capacity originally planned. This level of demand has prompted the company to accelerate preparations and raise production capacity to meet customer needs.

Several applications are contributing to communications power demand. High-performance power supplies for mobile antennas used in commercial, automotive, and airborne applications continue to see expanding demand. These products serve different operating environments, but the company’s update indicates that each is part of the broader growth in its communications power portfolio.

A new-generation power supply for home receivers is another contributor. The product successfully entered mass production in September, and the company expects shipments to increase further in the fourth quarter. The launch adds a newer product to the communications portfolio at a time when customers are already seeking more supply. Its shipment ramp, together with demand for mobile antenna power, is expected to support the business’s near-term performance.

To respond to the order level, Chicony Power said it is working to secure materials earlier and increase capacity. These steps are intended to address the gap between customer demand and the company’s original production planning. The company is aiming for fourth-quarter communications power revenue to grow by multiples compared with both the previous quarter and the same period last year. This is a company target, rather than a reported result, and depends on its ability to execute production and deliver products as planned.

The expected growth in communications power could also improve the company’s overall product mix. As laptop-related business faces an early off-season, stronger contributions from communications products and continued development in server power may help diversify operating support. The company specifically described non-laptop power businesses as an important source of momentum, while noting that server shipments may still be affected by supply and testing bottlenecks.

Overall, Chicony Power’s update presents a business environment shaped by two different sets of conditions. Laptop products are facing a short-term slowdown associated with memory shortages, supply-chain constraints, and earlier-than-usual customer inventory adjustments. Communications power, by contrast, is benefiting from strong orders, new product shipments, and capacity expansion efforts. Server power retains a strong demand outlook, although shortages of key components and testing equipment have delayed some customer schedules. The balance between these segments, and the company’s ability to meet communications orders while resolving operational bottlenecks, will be central to its fourth-quarter performance.

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