Notebook production was down in October, but primary because of the factory shutdown due to Chinese national holiday and not because PC demand softened. However, Windows 10 PC system sales have been sluggish to date, and unless there is a miraculous December finish, PC market will be down around 10% Y-Y. November production is expected to bounce back modestly ahead of the Christmas holiday, but then pull back in December before yearend.

ODMs, which helps to design and build PC systems have had to change their business model given declining PC numbers. They have allocated portions of their resource to other businesses such as tablets (which is also declining), smartphones, and servers/storage systems. ODMs will continue to be a vital part of the PC ecosystem, but it will be very different within a couple of years. Currently there are five major Taiwan-based ODMs, but as the PC market erodes, so may the number of ODMs.