TECH GIANTS AIM HIGH WITH FOCUSED STRATEGIES FOR 2025

Major players in the information communication technology and consumer electronics (ICT and CE) market are aiming high in 2025 by building on the back of their 2024 performances with distinct growth strategies.

FPT Retail, the retail arm of tech giant FPT Corporation, Mobile World Investment Corporation (MWG), and Digiworld Corporation are prominent representatives with unique strategies designed to capitalise on opportunities and overcome challenges.

Photo: baodautu.vn

In terms of market share, Mobile World is currently the largest company, with annual revenue touching billions of US dollars. After a decline in both revenue and profit in 2023, Mobile World made a strong comeback in 2024, reporting significant improvements.

FPT Retail and Digiworld also experienced a recovery in 2024. However, the driving forces behind the growth of each company are different.

At Mobile World, mobile phones, computers, and electronics remain the key pillars, generating revenue of $3.64 billion in 2024, accounting for 67 per cent of the company's total revenue. The food and fast-moving consumer goods segment follows closely, contributing $1.64 billion, or 30 per cent of total revenue.

In 2024, Mobile World raked in $5.37 billion in net revenue, growing 13 per cent on-year. Its gross profit margin amounted to $1.1 billion, representing a 22 per cent increase. As a result, net profit for the year reached $148 million, 22 times higher than in 2023.

Meanwhile, FPT Retail's performance is mainly driven by the Long Chau pharmaceutical chain, with the company's loss of more than $13 million in 2023 largely attributed to costs related to this chain.

Last year, FPT Retail's net revenue from IT devices, phones, components, and accessories approximated $604 million, accounting for 38 per cent of total revenue. Meanwhile, revenue from pharmaceuticals surpassed $1 billion, contributing 62 per cent of FPT Retail's total revenue.

These two segments contributed 50 per cent and 49 per cent to the company's total net revenue in 2023, respectively, indicating that pharmaceuticals, primarily the Long Chau chain, are increasingly becoming a major pillar for the company.

Unlike Mobile World and FPT Retail, Digiworld plays a crucial role as a primary distributor.

In the wholesale ICT and CE market, Digiworld holds a strong position due to its large customer base and solid financial health.

Furthermore, the company enjoys a significant advantage in managing distribution channels for new drug brands entering the Vietnamese market.

Digiworld's net revenue in 2024 reached $884 million, up 17 per cent, with post-tax profit amounting to $17.8 million, showing 25 per cent jump on-year. Additionally, the gross margin grew 9.3 per cent, a notable improvement from 8.3 per cent in 2023.

This improvement was largely attributed to increased contributions from the office equipment segment, which accounted for 19.9 per cent of total revenue in 2024, compared to 18.3 per cent in 2023. Other segments, including consumer goods and home appliances, also saw increased contributions.

Since the driving forces behind each company's growth differ, these three giants have set distinct strategies and expectations to foster growth in 2025.

Mobile World aims to achieve revenue growth of more than $160 million for its consumer electronics retail chains Thegioididong.com (including Topzone - the fresh chain of Apple authorised stores) and Dien May Xanh. The company will not expand its offline stores but will focus on optimising and boosting the sales performance of existing stores.

For the online channel, Mobile World plans to create a technology and electronics shopping destination with a diverse product range, focusing on boosting services.

Topzone aims to achieve $1 billion in retail revenue from Apple by 2027.

Mobile World has also set ambitious targets for its Bach Hoa Xanh chain, aiming to become Vietnam's leading retail chain for food and consumer goods, with revenue reaching $10 billion before 2030.

For 2025 alone, the goal is to achieve at least $280 million in revenue, open 200-400 new Bach Hoa Xanh stores, and increase online revenue by at least 300 per cent compared to 2024.

At FPT Retail's 2025 AGM, scheduled to be held on April 25, the company plans to present a consolidated revenue target of $1.9 billion, up 20 per cent, along with a pre-tax profit target of $36 million, reflecting a 71 per cent jump compared to 2024.

KB Vietnam Securities Corporation (KBSV) assumes that the Long Chau chain will continue to experience strong revenue and profit growth in 2025, making a significant contribution to FPT Retail.

KBSV predicts that FPT Long Chau will open 100 new outlets in 2025, as Long Chau's vaccination centres are being developed under the pharmacy-based model, which has proven successful with one vaccination centre for every 5-6 effective in a given area.

Revenue for the Long Chau chain in 2025 is expected to reach $1.28 billion, up 28 per cent, with vaccination centre revenue accounting for 6.9 per cent.

The total number of pharmacies and vaccination centres is projected to reach 2,343 units and 226 units, respectively.

At Digiworld, during a meeting with investors in mid-February, the company's leadership revealed reaching a target of 15 per cent growth in revenue and 18 per cent growth in net profit.

The office equipment and home appliance segments will be the key drivers, with expected increases of 25 per cent and 35 per cent, respectively. Traditional segments like laptops and mobile phones are projected to grow by 9-12 per cent.

While Mobile World remains the market leader with added momentum from the Bach Hoa Xanh chain, and FPT Retail focuses on the Long Chau chain, Digiworld continues to maintain a stable position in the supply chain.

Each company has developed its own strategy to capitalise on opportunities in 2025, with the expectation that the demand for consumer electronics will return to pre-pandemic levels, potentially driving stronger growth.

According to MB Securities (MBS), in 2025-2026, the proportion of smartphones supporting AI in total smartphone exports is expected to increase by 14 per cent compared to 2024.

The prices of new smartphone models are expected to be at least 5 per cent higher than previous models due to the integration of AI, leading to higher production costs.

The demand for smartphones in Vietnam is expected to grow positively from a low base, with projected revenue growth of 10 per cent in 2025-2026.

Vietnam still has a low rate of Internet of Things connectivity per capita, and the strong trend of technology adoption among the new generation of consumers will be the key driver of growth in the market for IoT-integrated consumer electronics products.

Source: VIR