Arima handset shipments to LGE to jump to 10 million units in 2009

27 August 2008

LG Electronics (LGE), ambitiously eyeing the emerging markets, has placed orders with Arima Communications for at least 12 new 2.5G handsets, with shipments to reach as many as 10 million units in 2009, according to industry sources.

LGE's partnership with Arima has been extending from entry-level and mid-range multimedia handsets to ultra low-cost models. LGE is increasing its outsourcing in line with its thrust into the emerging markets, with an aim to become the world-wide number-three handset vendor in 18 months' time, the sources said.

Arima's handset chip suppliers, MediaTek and Infineon Technologies, are also expected to benefit from the LGE orders, the sources disclosed. MediaTek chips will be used for entry-level and mid-range LGE models, and Infineon solutions will be adopted for the first time for ultra low-cost ones, the sources added.

LGE is outsourcing a minor portion of its orders to Compal Communications for handsets adopting Texas Instrument (TI) chips, while most other orders have gone to Arima, the sources said.

Arima has already secured orders for at least 12 LGE models, with shipments starting towards the end of 2008, the sources said, adding the orders have already extended to the second half of 2009.

Arima currently handles four LGE handsets, with total 2008 shipments expected to reach 3.5-4 million units. Shipments to LGE will reach 10 million units in 2009, an amount comparable to Arima's shipments to its current biggest client Sony Ericsson, the sources commented.

Arima is expected to ship 1.8 million handsets in August, driven by shipments of Sony Ericsson's T303, and September shipments may reach two million units as Arima begins to ship Sony Ericsson's K330, the sources said.

Third-quarter shipments are expected to total five million units, with shipments staying at high levels in October and November, the sources estimated, adding Arima is likely to achieve its 2008 shipments goal of 15 million units.

LG aims to ship two million handsets in 2008; Arima to be direct beneficiary

13 March 2008
LG Electronics has said it is aiming to grow its handset sales contribution in 2008, and Arima Communications, the OEM partner of LG, should be the direct beneficiary of the move.
During a March 12 event to launch new handsets in Taiwan, Finsen Chen, LG president of telecom business unit, Taiwan, said the company aims to grow its handset sales contribution by 7-8 percentage points on year in 2008, up from 24% in 2007. As for the Taiwan market, LG aims for a handset sales amount of US$100 million for the year.
Arima, which has already secured OEM orders for three 2.5G handsets from LG, is believed to be the direct beneficiary of the aggressive sales plans. Industry sources estimate that LG is likely to ship a total of two million handsets in 2008. The sources added in saying that Foxconn International Holdings (FIH) also produces another 2.5G handset for LG.
In addition to handsets supporting Symbian and Windows Mobile platforms, LG said it is closely working with Google to develop Android-based handsets. Chen remarked in saying that the company will introduce a Android handset to the Taiwan market during late 2008 to early 2009 if the company sees demand for the platform.
On a separate note, LG introduced five new handsets to the Taiwan market: the KS20, KF600, KF510, KP215 and KP320, of which, the KP320 is produced by Arima.

Arima Communications handset shipments to peak at 5-6 million units in 3Q08

28 January 2008
Arima Communications is expected to ship two million handsets in the first quarter of this year, with the shipments growing to 2.5-3 million units in the second quarter before peaking at 5-6 million units during the July-September period, according to sources at Taiwan-based handset component makers.
Handset shipments for all of 2008 are expected to total 14-16 million units, up from 9.5 million units shipped in 2007, the sources estimated.
Arima will begin shipping the T270 and T280 to Sony Ericsson in the first quarter, followed by the R300 Radio in the second quarter, while phasing out production of Sony Ericsson's T250, K200 and K220 during the first half, the sources noted.
Arima will also manufacture four new handsets for LG Electronics this year with total shipments expected to reach two million units, indicated the sources, noting that all of the four models, including the KP320 slated for shipment in the first quarter, will be built using handset solutions from MediaTek.
Arima's other handset clients also include Sharp of Japan and imobile of Thailand, said the sources.

Arima Communications lands more handset orders from LG; sees strong shipments in October

5 Nov, 2007

Arima Communications has received orders from LG Electronics for three new ODM handsets, including two low-cost multimedia models and one ultra-low cost model, according to market sources. In addition, the company also recorded strong shipments in October.
Arima will use chipset solutions from MediaTek for the production of the two multimedia handsets, while utilizing the LoCosto solution from Texas Instruments (TI) for the production of the ultra-low cost model, the sources noted.
Since the fourth quarter of 2006, Arima has made four handsets – the KG200, KG300, KG195 and KG198 – for LG, with combined shipments already exceeding three million units, said the sources.
In addition, LG reportedly has been in talks with other Taiwan-based makers about possibly releasing orders for smartphones, the sources indicated.
In other news, Arima shipped 1.61 million handsets in October, the highest level in 18 months, according to sources at the company. However, for the first 10 months of 2007, handset shipments totaled 7.86 million units, down 34% on year, according to a Chinese-language Commercial Times report.
Arima's October revenues, in line with increasing shipments, topped NT$3.56 billion (US$109.9 million), up 144.2% on year, and for the first ten months, revenues accumulated to NT$14.97 billion, down 28.2% on year, according to a company filing the Taiwan Stock Exchange (TSE).

Top 5 Mobile Phone Manufacturers Consolidate Their Market Share Lead

25 Oct, 2007
How much did Nokia increase its mobile-phone unit shipments in the third quarter? More than the total second-quarter mobile-handset shipments of Fujitsu, Ningbo Bird, TCL-Alcatel, Panasonic, Pantech & Curitel, and UTStarcom - combined.


Indeed, Nokia's third-quarter gains were impressive, with its global mobile-handset shipments rising by a stunning 10.9 million units compared to the second quarter. The Finnish mobile-handset sales leader increased its shipments to 111.7 million units in the third quarter, up 10.8 percent from 100.8 million in the second quarter. This gave the company a global market share of 39.5 percent, up from 37.9 percent in the second quarter, helping it to pad its market dominance.

"Nokia is capitalizing on the increasing popularity of multimedia- and business-oriented applications for mobile phones," said Tina Teng, analyst, wireless communications, for iSuppli. "The company's shipments of 'convergence' mobile phones that integrate multimedia and smart-phone features grew by 53.8 percent in the third quarter of 2007 compared to the same period in 2006."

Nokia also remained the leader in terms of operating profit in the third quarter. The company's mobile device business unit achieved an exceptionally-healthy 22.2 percent operating margin during the period. This compares to an average operating margin of 10.5 percent for the Top-5 mobile-handset suppliers in the third quarter.
The only disappointment in Nokia's third-quarter results was its performance in the Americas region. Nokia in the third quarter suffered a unit-shipment decline of 12.7 percent in Latin America and of 1.7 percent in North America compared to the same period in 2006.


A Q3 to remember
The strong results from Nokia came during a robust period for the global mobile-handset business and its leading players. Worldwide mobile phone shipments during the period amounted to 283 million units, up 6.4 percent from 266 million units in the second quarter and a 15.4 percent increase from 245.3 million units in the third quarter of 2006.
High first-time sales of phones in emerging markets and high replacement rates in Europe were the major factor driving the growth.
The Top-5 mobile handset suppliers benefited from the healthy growth, with all of these companies increasing their shipments during the third quarter compared to the second.
Combined shipments for these companies rose 9.6 percent during the third quarter compared to the second. At this margin of expansion, these companies outgrew the overall market and thus gained aggregate market share at the expense of the smaller suppliers.



Samsung soars again
While Nokia's unit shipment gain was impressive, Samsung Electronics actually posted a slightly larger increase on a percentage basis, helping the company to maintain the second rank in the industry.
Samsung's global mobile-handset shipments rose to 42.6 million units in the third quarter, up 13.9 percent from 37.4 million in the second quarter. Compared to the third quarter of 2006, Samsung's shipments rose by 38.8 percent, the highest rate of all the Top-5 mobile-handset makers.
This boosted Samsung's market share to 15.1 percent, up from 14.1 percent in the second quarter, giving the company a 2.2 percentage point lead over No. 3 ranked Motorola. This is up from a 0.7-point gap in the second quarter.
"Samsung's strong performance was due to impressive increases in shipments in the European and Americas regions," Teng said. "The company's shipments in Europe and the Americas rose by 28.1 percent and 26.6 percent respectively in the third quarter. This more than offset the 6 percent sequential decline in shipments in Asia during the same period."
Samsung has chosen not to participate in the Ultra Low Cost Handset (ULCH) market and instead has put increased focus on high-end, high-margin 3G handsets. This strategy paid off, with the company boosting its average operating margin by $1 during the period.
The company in the third quarter yielded a 12.3 percent operating profit margin, up from 8.4 percent in the second quarter.
Motorola on the comeback trail?
Based on iSuppli's preliminary estimate of Motorola's share, the company shipped 36.5 million mobile handsets during the third quarter, up 2.8 percent from 35.5 million in the second quarter. This lagged the handset market's overall shipment growth rate of 6.4 percent, but kept Motorola's market share fairly steady at around 13 percent. However, on a year-to-year basis, Motorola's shipments plunged by 32.7 percent, making it the only company not to post an increase on an annual basis in the third quarter.
Motorola in the second quarter lost its long-time No. 2 ranking to Samsung. The company struggled to achieve an operating profit in the first and second quarters.
"Despite Motorola's recent woes, there are signs the company is gradually regaining its footing in the global mobile handset market," Teng said. "With its new product line coming out during the holiday season, Motorola should be able to achieve continued growth in shipment volume during the fourth quarter."

Final figures on Motorola's shipments will be available after it issues its third-quarter results later this week.

LG lives large
LG was the clear leader in terms of volume-shipment percentage growth in the third quarter, with its sales rising by 14.7 percent sequentially. The company's global mobile-phone shipments increased to 21.9 million during the third quarter, up from 19.1 million in the second quarter.
However, all the growth was driven by emerging markets such as the Middle East, Latin America, India and China, as was reflected in its Average Selling Price (ASP). Slow sales in North America and Europe resulted in LG's mobile-handset ASP falling to $124, down 18.6 percent from $152.3 in the second quarter.
Despite a revenue decline of 7.9 percent measured in South Korean won, LG still managed to maintain its operating profit at 8.4 percent in the third quarter.

Arima Communications ships over one million handsets in September

3 Oct, 2007

Handset shipments from Arima Communications reached over one million units, buoyed by increasing shipments to Sony Ericsson and LG Electronics, according to estimates by Taiwan-based handset component makers.
Arima's third-quarter handset shipments totaled about 2.8 million units, compared to 1.78 million in the first quarter and 1.66 million in the second quarter, the sources estimated.
For the fourth quarter, Arima is expected to ship 4.0-4.5 million handsets, bringing the total shipments for all of 2007 to 10-11 million, the sources projected.
Sales of Sony Ericsson's T250s, of which the company is outsourcing production to Arima, are booming, and this has prompted Sony Ericsson to add four follow-up versions of the T250 in the fourth quarter, the sources noted.
Arima's handset shipments to LG are expected to top two million units in 2007 making the South Korea vendor the second largest client for Ariam, accounting for 20% of Arima's total handset shipments, said the sources.
Additionally, Arima has landed 2.5G handset orders from Sharp with shipments set to start in the first quarter of 2008.