D-Link 2004 Annual Report Download - page 5

North America
For fiscal year 2004, the North America region sales grew
20 percent to US $322 million on a year-over-year basis and
accounted for 33 percent of the company's consolidated revenue.
The North America region continued its strategic leadership role in
product planning, product development and product marketing in
2004. In addition to research and development, sales and
marketing services and regional management for North America,
the region made significant inroads with emerging technologies for
the digital home, including high-growth areas such as wireless,
VoIP and multimedia. The North America region also realized
significant growth from new business opportunities with increased
penetration to corporate customers through the company's
extensive channel structure.
Europe, the Middle East and Africa
The EMEA business units drove a steady revenue increase to
US$ 315 million, posting a solid 40 percent gain in fiscal 2004,
representing 33 percent of the company's consolidated revenue.
Our EMEA region successfully completed a consolidation plan,
which unified sales, marketing and product strategies across all
countries in the region. This unification effort resulted in a stronger
brand presence for D-Link throughout Europe, the Middle East
and Africa, increasing the leverage of each individual country to
penetrate markets and win new business. D-Link brand equity has
been well recognized in EMEA. Particularly in Russia, where
D-Link's sales grew 78% year-over-year.
The EMEA business units achieved success with a significant
percentage of sales coming from switching, security and wireless
networking sales into small and medium-sized enterprise. In
addition, broadband CPE sales to service providers in Europe and
Russia were particularly booming thanks to the penetration of
ADSL technology, and D-Link's strong product offering and
dominant market position.
Asia Pacific and Other Regions
The Asia Pacific and Other emerging market regions grew 37
percent to US $330 million in fiscal 2004, representing 34 percent
of the company's consolidated revenue.
D-Link continues to be one of the top three broadband equipment
suppliers in Japan. In Latin America, D-Link dominated the
market with contract wins from major telecommunication
companies and sales growth of 233% in 2004. In Australia, the
company captured a 60 percent market share by being the number
one Digital Subscriber Line (DSL) provider with telecommunication
companies across the board. In 2004, D-Link India marked its ten-
year anniversary with numerous awards and a marked increase in
sales. In India, D-Link is the market leader of both low and high-
end networking and structured cabling.
Selling to Consumer, Business and Broadband Customers
We evaluated and modified our business strategy in 2004 to
strategically focus on the three distinct customer segments D-Link
sells to worldwide: the end-user consumer, the business customer
and the broadband provider.
Our award-winning consumer products are effectively meeting
worldwide customer demand in an exceedingly timely and cost-
effective manner. D-Link offers consumers advanced connectivity
products that are easy to use, superior in performance, and above
all, of great value.
D-Link's core competency is in Ethernet networking, and the
company drives innovation and development by producing a wide
range of powerful high-end wired and wireless networking
solutions for businesses at the enterprise, workgroup and
departmental processing levels.
As broadband provides more consumers and small businesses
worldwide high-speed access to the Internet, D-Link offers the key
connectivity hardware, interactive media and security solutions to
the end-user through service providers worldwide. D-Link
develops a wide range of broadband products perfectly suited for
service providers to sell to consumers and businesses today.
A Word on Alpha Networks
The successful reorganization initiative to carve out the
OEM/ODM business from the D-Link Brand business resulted in
streamlined operational efficiency and increased business
opportunities for D-Link and Alpha Networks companies. Alpha
Networks successfully went IPO in 2004 and continued its
successful expansion with a more diversified customer base,
ending the fiscal year with US $422 million in revenue.
A Word of Thanks to our Shareholders, Customers,
Partners and Employees
Our goal is to be a great company in all facets of business. We are
not just satisfied with our number one position in global SOHO
and home networking. We strive to be number one in global SMB
networking as well. We maintain very high expectations and are
confident about our future. We are proud of our record-setting
accomplishments in 2004 and will build on this momentum.
In 2005, we will continue to be driven by product innovation,
while analyzing all markets and listening to our customers' needs
to help determine the direction of our business. The company is
well-positioned to leverage our past success in consumer
networking to further grow its sales into the SMB and service
provider market segments worldwide.
I wish to thank our shareholders, customers, partners and
employees for their support in 2004. We are eager to meet the
challenges ahead as we direct our resources to major growth areas,
encourage the enthusiasm and determination within each
D-Link team member, and drive to become a more competitive
and successful company in 2005 and beyond.
D-Link 2004 Annual Report 3
Ken Kao
Chairman and Chief Executive Officer,
D-Link Group