Cooling module maker Asia Vital Components (AVC) will be scaling up its output for cloud servers and datacenters in 2021 when the Taiwan-based company expects its profits to hit another record high.

In 2020, 55.67% of AVC's revenues were contributed by cooling products, 35.1% by computer chassis and system assembly services, and 9.02% by peripherals.

AVC has been shifting its business focus to communication and cooling products in the past few years to reduce the revenue share of its computer chassis and system assembly businesses.

The company's entry into the server market also significantly boosted its sales in 2020 with net profits hitting a record high at NT$1.92 billion (US$66.81 million).

AVC's revenues will grow further in 2021 as the company has a new datacenter client and will see extra income for its server cooling solution business.

AVC expects its communication products to become another key revenue growth driver in 2021. The company is a supplier of 5G AAUs, cooling fans and cooling modules.

AVC's 2021 gross margin is only expected to see limited impact from rising material costs in the first half as the company has already prepared extra material inventory and its clients have mostly agreed to AVC raising its product prices.

Demand for smartphone cooling solutions has started weakening, and many China-based competitors have joined the competition for smartphone cooling solutions. Most Taiwanese cooling solution providers have already turned their focus to server cooling solutions that offer higher profitability.

AVC to raise cooling fan solution shipments for datacenter servers
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