Increasing investments in digital transformation, data centers and IoT deployment were instrumental in the more than 5% average revenue growth of the top 20 Asia-Pacific technology companies in 2020.
Increasing investments in digital transformation, data centers and Internet of things (IoT) deployment were instrumental in the more than 5% average revenue growth of the top 20 Asia-Pacific technology companies in 2020. Such investment not only allowed tech companies to maintain healthy growth during the COVID-19 pandemic-disrupted year, but also thrive under very challenging conditions, according to GlobalData.
Among the top 20 tech companies, 65% reported year-on-year (YoY) revenue growth with six companies reporting double-digit growth in 2020. Tencent, Taiwan Semiconductor Manufacturing Co. Ltd (TSMC) and WPG led the table with each registering over 20% YoY revenue growth.
“A significant increase in online advertisement revenue, mainly from e-commerce platforms, FMCG and education sectors, and revenue from online games helped Tencent clock 27.9% growth in 2020. Increasing demand for major smartphone games including Honour of Kings, Peacekeeper Elite, PUBG Mobile and the newly launched Moonlight Blade Mobile titles helped improve the sales of its online games. The company also recorded impressive growth in commercial payment and wealth management services,” said Keshav Kumar Jha, Business Fundamentals Analyst at GlobalData.
Meanwhile, increase in the sales of optical components, analog IC and mixed signal components, especially the sales of comparators, digital/analog converters, LED panels and sensors, helped WPG register YoY growth in revenue.
“Accelerated digital transformation in the wake of COVID-19 led to the growth in demand for high-performance computing platforms from TSMC. Besides, TSMC reported growth due to increase in demand for 5G smartphone and IoT platforms,” Jha continued.
Apart from an increase in the sales of DRAM and NAND flash products, growth in the market for servers allowed SK Hynix to record double digit revenue growth in 2020, compared to its low-key financial performance in the previous year.
Chinese tech major Xiaomi recorded 6.1% increase in smartphone sales, mainly due to considerable increase in demand for its premium smartphones. The company’s ‘Smartphone × AIoT’ strategy seemed to start paying dividend with the IoT and lifestyle products segment registering 8.6% YoY growth in 2020.
Panasonic was the only company that reported over 10% decline in revenue. Apart from its struggling TV and automotive solutions businesses, the adverse effect of COVID-19 was another major factor that contributed to a decline in Panasonic’s YoY sales.
“The health crisis has necessitated strengthening the supply chain processes and maintaining close collaboration with both upstream and downstream business partners for uninterrupted work and production. Spending by enterprises across industries on digitalization is likely to increase. The shipment of 5G smartphones could also increase with the faster roll-out of 5G networks and the semiconductor industry may emerge as the net winner in the years to come,” said Jha.