Compal Electronics (2324) Q2 2025 earnings summary

Executive summary

• Q2 2025 revenue was TWD 118.4 billion, with 70% from PC and 30% from non-PC segments; H1 2025 revenue was TWD 379.5 billion, down 13% year-over-year.

• PC unit shipments in Q2 were 7.1 million, up sequentially but down from 8.7 million in Q2 2024.

• Gross margin improved to 5.9% in Q2, up both quarter-over-quarter and year-over-year, driven by better product mix and transformation efforts.

• Net profit for Q2 was TWD 482 million, with EPS of 0.11; H1 net profit was TWD 2.7 billion, EPS 0.61.

• Board approved a $300 million investment in North America to scale the server business.

Financial highlights

• Q2 gross margin rose to 5.9%, operating margin at 1.5%.

• Q2 net profit was TWD 482 million; EPS 0.11.

• First half 2025 revenue declined 13% year-over-year to TWD 379.5 billion.

• First half net profit was TWD 2.7 billion; EPS 0.61.

• Non-operating loss in Q2 was TWD 1.3 billion, mainly from forex losses.

Outlook and guidance

• Moderate growth expected in Q3; PC shipments to grow low single digits quarter-over-quarter.

• Growth pillar businesses projected to see high single-digit quarter-over-quarter growth.

• Strategic investments in the US aim to mitigate global trade risks and expand server, notebook, and automotive electronics operations.

• Focus on scaling AI server growth, with engineering headcount to exceed 1,000 by end-2025.

• Cautious optimism due to ongoing global trade and tariff uncertainties.