Taiwan-based server chassis maker Chenbro Micom will soon complete the construction of a new plant in southern Taiwan and expects to kick off pilot runs at the facility in November, according to company president Corona Chen.

Volume production at the Chiayi County plant is scheduled for the second quarter of 2022, Chen said.

Thanks to growing server chassis orders from China and the US, Chenbro has been expanding capacity at its factories in Taiwan. The new plant will be able to roll out 50,000 chassis a month in the second quarter of 2022, with volumes to rise to 100,000 units by the year-end, Chen noted.

Chen pointed out that server demand is growing in both the US and China in 2021, with that from the US 5-10% stronger than that from China, as some of China's cloud computing businesses in overseas have been disrupted amid the US-China trade tensions. However, government and domestic demand in China has remained robust.

Chenbro has also landed strong orders from China's IPFS storage market, Chen noted.

Chenbro has launched many off-the-shelf products to system integrators and channel retailers for AI and edge computing applications, but shipments for these products are still limited.

Chenbro has announced consolidated revenues reaching the highest quarterly record at NT$1.82 billion (US$64.72 million) in the first quarter of 2021, up 36% on year. However, the company's gross margin slipped 3.26pp sequentially and 4.33pp on year to only 21.63% in the quarter due to increased expenses from raw materials.

The appreciation of Taiwan's currency is also undermining the company's profitability in 2021.

In the first quarter, server and storage chassis products accounted for 97% of Chenbro's revenues, with PC chassis accounting for the remaining 3%. In terms of geography, 36% of its first-quarter shipments went to China, 46% to the US, 6% to Europe and 12% to others.