Core Viewpoint - ASUS will suspend the launch of new smartphones, including ZenFone and ROG Phone, in 2026 due to regular business adjustments and rising component costs, particularly storage prices, which have become unsustainable for the company's mobile division [1][4][5]. Group 1: Business Strategy and Market Position - ASUS has focused on two main smartphone lines: the high-performance ROG gaming phones and the cost-effective ZenFone series, but has primarily sold ROG phones in mainland China for many years [1][2]. - The company has faced significant challenges in the smartphone market, with its mobile business revenue consistently declining from 18% in 2016 to just 1% in 2023 [3]. - The competitive landscape for gaming smartphones has intensified, leading to the exit of several brands from the market, including Razer and Lenovo's gaming phone line [3]. Group 2: Financial Performance - Despite the struggles in the smartphone sector, ASUS's overall performance has been strong, driven by AI servers and commercial PCs, with a revenue of 535.98 billion New Taiwan Dollars (NTD) in the first three quarters of 2025, a 24% year-on-year increase [5][6]. - The third quarter of 2025 saw a record revenue of 189.91 billion NTD, a 21% increase year-on-year, although gross profit declined by 9% due to rising costs [6]. - The company's server business is growing, accounting for nearly 20% of revenue, with plans for further expansion in the AI server market [6]. Group 3: Industry Trends and Challenges - The global memory chip market is experiencing significant price increases, with DRAM costs rising approximately 25% for low-end smartphones and 10% for high-end models, impacting overall production costs [4][5]. - The smartphone market is expected to face declining shipment forecasts due to weak demand, further pressuring manufacturers [5]. - ASUS plans to raise prices on some PC products starting January 5, 2026, in response to rising memory and storage costs [7].