Compal Electronics (2324) investor relations material

Executive summary

• Q2 2026 revenue reached TWD 238.3 billion, up 32% year-over-year, driven by strong AI server and non-PC segment growth.

• Net profit for Q2 was TWD 3.1 billion, up 59% quarter-over-quarter and 549% year-over-year, with EPS at TWD 0.73.

• Transformation efforts have diversified revenue, with non-PC mix rising to 34%-35%, targeting 40% by year-end.

• AI server business now comprises about 70% of server revenue, fueling overall growth.

• Expanded global manufacturing and integration capacity, including a major new facility in Taiwan to support AI server growth.

Financial highlights

• Q2 gross margin was 4.6%, pressured by rising component costs, especially memory.

• Net income to parent was TWD 3.1 billion, up 59% QoQ and 549% YoY; EPS at TWD 0.73.

• First half 2026 net profit was TWD 5.1 billion, up 91% year-over-year, with EPS of TWD 1.18.

• Book value per share improved to TWD 31.3 at Q2 end.

• Cash and cash equivalents stood at TWD 82.9 billion at Q2 2026.

Outlook and guidance

• Q3 2026 server revenue expected to grow by high double digits quarter-over-quarter, driven by AI servers.

• FY 2026 non-PC mix targeted to approach 40%; server business expected to reach 10% of total revenue.

• 2027 guidance: server business to contribute 30%-40% of revenue, with PC mix dropping below 50%.

• PC shipments expected to decline at a mid-teens rate for FY26, with ASP increases supporting revenue.

• AI transformation expected to continue driving margin inflection and external growth.