TAIPEI — The revenue recorded by top Taiwanese tech companies climbed 12.25% year-on-year in May, driven by robust demand from Chinese handset-makers and for networking equipment that helped to offset soft iPhone sales.

The accumulated revenue for the 19 companies tracked by the Nikkei Asian Review surged to 875.42 billion New Taiwan dollars ($29.31 billion) in May. For eight of the 19 tech companies, May also marked their highest monthly revenue so far this year.

The combined sales of the four electronics manufacturing service providers monitored by Nikkei grew 17.45% on the year. Key iPhone assembler Hon Hai Precision Industry, better known as Foxconn Technology Group, saw revenue rise 24.03% year-on-year to NT$347.1 billion.

Its smaller rival Pegatron reported an annual growth of 15.67% to NT$90.96 billion in May. Both sets of numbers were backed by growth in non-iPhone products.

“The communication goods drove the revenue increase, followed by consumer electronics products,” Foxconn said. The company declined to detail performance of the various product lines, but it is known that its communication goods mainly refer to networking equipment, servers and data centers, and its consumer electronics products include iPhones and Android phones.

Pegatron attributed its robust sales performance to steady demand from networking devices and new orders of consumer electronics goods, such as game consoles, wearables and smart home devices.

The company has been diversifying its product portfolio and adding new clients to alleviate the traditionally lackluster April-June quarter for iPhones. Global iPhone demand tends to be slow in the quarter as customers await the unveiling of new models in the autumn.

Vincent Chen, an analyst at Yuanta Securities Investment Consulting, said that “years of efforts in product diversification paid off” for electronic manucturing service providers.

Chen said the improving global economy also lent support, as smartphone orders from Chinese companies picked up in the quarter. Demand for data centers continues to be strong, while Apple launched its new iPad during the period. “These all helped,” Chen said.

Chinese smartphone vendors, including Huawei Technologies, Oppo, Vivo, Xiaomi, are gaining sales momentum after launching new models since March, underpinning growth in the supply chains.

Largan Precision, which supplies smartphone camera lens to Apple, Huawei and Oppo, reported 14.69% year-on-year growth to NT$4.31 billion in sales in May, its highest monthly record this year. “The revenue was driven by some new orders and the improvement of camera lens production,” Largan CEO Adam Lin told reporters after the company’s annual general meeting on Tuesday.

Largan declined to elaborate on its export picture, but it is the key supplier to Huawei’s flagship triple-camera smartphone P20 that launched in April. Largan Chairman Lin En Chou, who rarely appears at public events, attended Huawei’s product launch for P20 in Taipei in April to support its major client.

The five semiconductor companies monitored by Nikkei also saw revenue growth from a year ago.

May sales for Taiwan Semiconductor Manufacturing Co., the world’s biggest contract chipmaker, grew 11.23% to NT$80.9 billion while the revenue of its smaller counterpart United Microelectronics Corp. also rose 4.5% from a year ago. They both saw restocking chip orders rise for Chinese smartphone makers after a significant slowdown last year.

“We do see a rebound in demand for chips to go into Chinese smartphone makers as they are releasing new models of handsets,” said Liu Chi-tung, chief financial official at UMC. “We don’t know whether the recovery could last into the second half of this year.”

MediaTek, the world’s No.2 mobile chip provider after Qualcomm, also saw its revenue rise 10.68% from a year ago, thanks to fresh orders from Chinese smartphone makers. Both TSMC and UMC help MediaTek manufacture chips. As it rolled out cost-effective chip solutions in the first half of 2018, MediaTek recouped some market share lost last year to Qualcomm to supply chipsets to mid-range handsets made by Huawei, Oppo, Vivo and Xiaomi.

Nanya Technology continued to be crowned the best performer in May among the 19 companies, with revenue jumping 102.33% on increasing DRAM prices and limited supplies in the market. Nanya Technology is the world’s No. 4 maker of dynamic random access memory chips behind Samsung Electronics, SK Hynix and Micron.

HTC remained the weakest performer in May, as its revenue plunged 46.03% on the year for the 11th consecutive month of contractions. The embattled Taiwanese firm is struggling to increase revenue contribution from its virtual reality business to offset the company’s poor smartphone sales in the highly competitive industry.

AU Optronics and Innolux, the two leading Taiwanese panel makers, saw their revenue in May fall 21.69% and 8.26% respectively, as the companies suffered from continued falling average selling prices for displays amid excessive supplies and aggressive competition from Chinese rivals, such as BOE Technology Group.

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