Asustek Computer has seen its shipments to the DIY sector and related motherboards affected by Intel's supply strategy for CPUs, with the prospects that the CPU shortages, particularly those for desktop PCs, will continue into the second quarter of 2019, according to company CEO Jerry Shen.

The continued CPU supply crunch, escalating US-China trade disputes, and increasing competition in the notebook segment in Europe have pressed down Asustek's "operational visibility" for the fourth quarter of 2018 to the lowest level of 20% compared to an over 50% seen in previous years, Shen said.

Although Intel has pledged to address the supply issues since September and has continued to pour investments to ramp up output from its 10nm process, the tight CPU supplies have not been solved as the US chipmaker has given the priority to the production of high-end Xeon and Core series CPUs, instead of CPUs for the entry-level or other consumer models, Shen indicated.

However, with Intel maintaining its shipments of CPUs to the server and gaming PC sectors, Asustek's gaming PC business has seen little impact from the CPU shortfalls, Shen noted.

Meanwhile, Shen continued that the US-China trade dispute has caused the depreciation of currencies in a number of countries, including China, Russia, Indonesia and other emerging countries against the US dollar, which has increased hedge costs at Asustek.

As a result, Asustek expects its PC shipments to remain flat in the fourth quarter as compared to a quarter earlier, Shen said, adding that shipments of smartphones are expected to increase about 5%, while component shipments are likely to dip 5% during the same period.

Meanwhile, Asustek reported net profits of NT$3.343 billion (US$108.12 million) for the third quarter, up 151% on quarter but down 43% on year, with EPS coming to NT$4.5.

For the first three quarters of 2018, net profits totaled NT$7.05 billion, down 39% from a year earlier. The earnings translated into an EPS of NT$9.50 compared to NT$15.48 a year ago.

Gross margin stood at 11.7% in the third quarter, compared to 12.7% a quarter earlier and 14.4% a year earlier.