Letter To Shareholders - Mitac

2009, and 1.3 million units sold in Eastern Europe; this was a 16% and 20%
decline, respectively compared to the previous year. Sales to Europe as a whole in
2010 is estimated to remain stable at 15 million units. MiTAC branded products are
steadily gaining market share in the Pan-Europe market; it is the leading brand with
9% market share in Western Europe and 25% market share in Eastern Europe.
B.North America market
PND product sales in 2009 totaled 18 million units; this was a much smaller
decline of 3% compared to the 16% in the European market. Canalys projected a
similar sales volume of around 18 million units for year 2010. MiTAC captured
approximately 12% market share in the US, ranking third among other brands.
C. Asia-Pacific market
The Pan-Pacific region is the only place where PND showed growth; the growth
approximated 12% compared to 2008. Product sales totaled 4.7 million units in
2009, and Canalys projected a further 23% growth in 2010 to a volume of 5.8
million units. Overall market share is expected to reach 12%.
MiTAC’s products are well positioned. It gains new buyers through continuous
product innovation and integrated mobile positioning services that are helpful
toward further revenue growth and market share expansion.
(4) Corporate server/workstation series
Research conducted by IDC and Gartner concurrently indicated that the growth of
X86 servers is driving the recovery of the entire server market. Compared to 2009,
the server market is expected to grow by 5-9% in 2010. The low cost and high
performance characteristics of X86 servers shall become the customers' main
concern during IT equipment renewals.
The company offers a wide variety of server/workstation products from entry-level to
high-end solutions, regardless of Intel or AMD-based setups, MiTAC has them all. In
view of customers' growing awareness towards C/P ratios and operating cost controls,
there is great potential to the company’s server/workstation products. MiTAC
expects to capture 10% of the X86 server market.
3. Supply and demand projections in the future
(1) Client system business products
PCs have undergone many changes in the last twenty years and have reached
maturity. As for the U.S., Europe and Japan markets, the market is quite saturated, so
there is little room to grow. As for rising markets like China, India and South America,
because PCs there are not as common as in developed countries, we believe that we
will be able to maintain a positive growth in the future.
Besides common PC products, MiTAC has been actively studying high-value
added products, like all-in-one integration PCs, thin computers, point of sale systems
(POS) and portable mobiles devices etc for cloud calculating and other high-value
products.
(2) Enterprise products
With economic recovery more clear, enterprises are more willing to invest in IT;
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