Quanta Computer Inc.

Annual Report 2015

Report to Shareholders

Year 2015 was a challenging year as the global economy remains lackluster and the

consumer market slowly recovers. Despite the challenging macro environment, Quanta Computer

remains positive and continues to identify innovative ways to overcome obstacles ahead. The

Company leverages innovative thinking to optimize current operations. We also adopt the thinking

of “Core Motive is Innovation” and “Action Plan Is Change” in the process of new product

development. Employees and management team at Quanta Computer work together as a team with

relentless efforts. The Company’s revenue returned to a trillion dollar in FY2015 as a result of

team efforts and strong determination from every employee in the Company.

Quanta’s performance for FY2015 and outlook for FY2016 are as follow:

I. Revenue and Income

Consolidated revenue in year 2015 was NT$1,007.3BN, an increase of 8.7% from the

previous year. Net income after tax in FY2015 and FY2014 was NT$17.8BN and NT$19.2BN

respectively. Net income attributable to owners of parent in FY2015 and FY2014 was

NT$17.8BN and NT$18.9BN respectively. EPS in FY2015 was NT$4.62. Non-operating income

was NT$4.4BN.

Growth for the PC industry remains lukewarm in 2015 due to instability of the global economy

and geopolitical volatility. Moreover, fluctuation of foreign currency further deepened the

difficulty of overall business operation. To concur the ever-changing challenges ahead, Quanta

Computer repositioned its strategy and followed through four action plans defined in 2014, which

are identifying opportunities ahead of competitions; acceleration; simplicity and cost savings. To

act upon aforementioned action plans, the Company adopted new ways of thinking, new methods

of operation and leveraged courageous spirit to breakthrough existing barriers. Through integrated

logistic flow and strengthened electronic procurements, the Company was able to tighten control

of R&D and manufacturing know-hows in notebook production. Furthermore, resources dedicated

to new technology and new product developments also accelerated, while overall cloud business

remained robust. FY2015 revenue returned to $1 trillion dollar proved the effectiveness of team

work from the entire Company.

As a good corporate citizen, the Company has been publishing Corporate Social

Responsibility reports every year since year 2010. Third party validation was introduced in 2014

and onwards to improve reliability and quality of CSR reports and to further enhance the

Company’s corporate governance and transparency. Quanta Computer proactively plays the role

of a respectful corporate citizen by taking responsibilities and obligations as a member of the

global village.

II. Outlook in 2016

Year 2016 is filled with challenges as recovery of global economy remains lackluster and

competition remains fierce. New product development trend now leans toward greater product

variety at lesser volume. Cross industry alliance became a common practice as a result of this new

market trend. Quanta Computer continues to leverage existing management strategy to strive for

winning outcome and mindfully observe new market trend to better prepare ourselves for new

changes. To ensure the Company is ready to adopt new market trend and to integrate new

technology, we hold humble attitudes towards new technology advancement and devote more

resources into new product development.

Quants Computer’s new principles:

Superior Quality －

Ensure high quality is our top priority and allow high quality products to speak for our

superior manufacturing technique.

Superior Technology －

Continue to accelerate manufacturing technique and to increase standard for

automation. Leverage software applications, professional wisdom and encourage greater

potentials to become a leader in “smart-manufacturing”

Detailed Management –

Strengthen production management, enhance technology know-how and focus on

details within the existing fundamental development framework. Greater focus on

detailed management from quality control, production control, budget control to man-

power management.

Brighten Future －

Build on the above principles, the Company focuses on future development, encourages

innovation and break-through thinking in order to pave a brighter future for Quanta

Computer and let the Company shine.

The Company has set a new target and development methodology to tackle challenges

ahead. We strongly believe proactive thinking and responsible attitude are key elements in

better product creation and stronger operation performance. The ideology we follow is

“Innovation, Change and Transcend”, which can be achieved through continuous exploration

and strive for excellence. Building on the superior corporate value of Truthfulness, Kindness,

Beauty, Honesty, Trust and Caring, Quanta Computer continues to take steady steps and look

ahead to create greater value for our shareholders.

Chairman: Barry Lam

Vice Chairman: C.C. Leung

Chief Financial Officer: Elton Yang

* Note: ownership is 100% unless otherwise specified

（Ref. to Chart 1)

99.99%

24.81% 75.19% 0.44%

29.78% 37%

9% 9%

Quanta Computer Inc.

36.76%

0.81%

Quanta

Venture

Capital

Co., Ltd.

Quanta

Cloud

Techology

Inc.

RoyalTek

Company

Ltd.

Quanta Computer

Technology Investment

Corp.

TWDT

Precision

Co., Ltd.

Quanta Micro-

Systems

Inc.

CloudCast

Technology

Inc.

（Ref. to Chart 2)

Quanta

Int’l Ltd.

QCJ

Corp.

Quanta Cloud

Technology Japan

Quanta

Storage

Inc.

FaceVsion Technology

Inc.

DTG

(BVI)

Ltd. FaceVsion Technology

USA LLC

FaceVsion

(Changshu)

Trading

Co., Ltd.

FaceVsion

Techology

Hong Kong

Ltd.

Royaltek

Trading

(Changshu)

Co., Ltd.

Dragontech

Metallic

Industry

Co., Ltd.

Dragontech City

Metallic Changshu Co., Ltd.

Royaltek International Enterprises

Ltd.

Fly Dragon

Int’l

Ltd.

Dragon

Grand

Group

Ltd.

Chart 1

Quanta

Research

Int’l, Inc.

Quanta

Research

Cambridge

Inc.

(QRC)

Quanta

Manufact-

uring

Nashville

LLC

Quanta Manufac-turing Inc.

Quanta Computer Inc.

60%

19%

95%

Standard

(Shanghai)

Energy

Co., Ltd.

50%

Access

Int’l Co.

QCG

Computer

GMBH

Quanta Asia Ltd.

QCE Computer

BV

Quanta Capital

Manage-

ment Ltd.

Exmore

Services

Holding

Ltd.

Quanta Development

(Hong Kong)

Ltd.

ThinkTech Ind. E

Com. DE Informatica

SA

QCT

Inc.

QCT

LLC

Quanta Develop-ment Ltd.

QCT

Korea

Inc.

Quanta Int’l Ltd.

Tech Chain

(Hong

Kong)

Ltd.

Gem-Tech (Shanghai) Precision Mold Co.,

Ltd.

Tech

Chain

Ltd.

Quanta

Int’l

Technology

Ltd.

Q_Bus

Int’l

Ltd.

Exmore Services Holding (Hong

Kong) Ltd.

Quanta

Service

Nashville

LLC

Quanta

Computer

Nashville

LLC

QCH

Nashville

LLC

Zhan Yun

(Shanghai)

Electronics

Co., Ltd

Zhan Yun

(Chongqing)

Electronics

Co., Ltd

Changshu Zhan Yun

Electronics

Co., Ltd.

QCH Inc.

a Nevada

Corp.

Quanta

Computer

USA, Inc.

Quanta

Service

Inc.

Tech-Front

(ShangHai)

Computer

Ltd.

Tech-Com

(ShangHai)

Computer

Ltd.

Tech-Lead

(ShangHai)

Computer

Ltd.

Tech-Giant

(ShangHai)

Computer

Ltd.

Tech-Trend

(ShangHai)

Computer

Ltd.

Tech-Wave

(Shanghai)

Logistics

Co., Ltd.

Tech-Full

Computer

(Changshu)

Co., Ltd.

Tech-Front

(Chongqing)

Computer

Co., Ltd.

Tech-Wave

(Chongqing)

Logistics

Co., Ltd.

Kenseisha

Shanghai

P.M.P.

Co., Ltd.

CloudTech

（Beijing）

Technology

Co., Ltd.

CloudTech

(Chongqing)

Technology

Co., Ltd.

* Note: ownership is 100% unless otherwise specified

* Note 1: Quanta Storage America Inc. filed for brankcruptcy and received approval on June

22, 2015

* Note 2: Techman Inc. registered for name change to Techman Robot Inc. and received

approval on March 11, 2016

* Note 3: Ownership is 100% unless otherwise specified

Chart 2

Quanta Storage Inc.

Quanta Storage

International Ltd.

Techman Electronics

(Hong Kong) Ltd.

Quanta Storage

Holding Ltd.

E-Forward

Technology Ltd.

Quanta Storage

(BVI）Ltd.

Quanta Storage

Asia Ltd.

Quanta Storage

America, Inc. (Note 1)

Techman

Electronics

(Changshu), Ltd.

Quanta Storage

(Shanghai), Ltd.

Quanta Storage

Holding (Hong Kong) Ltd.

Techman Asia Ltd.

Quanta Storage

Investment Inc.

Techman Robot

Inc.

(Note 2)

(English Translation of Financial Report Originally Issued In Chinese)

Independent Auditors' Report

The Board of Directors of Quanta Computer Inc.：

We have audited the accompanying parent company only balance sheets of Quanta Computer Inc. as of

December 31, 2015 and 2014, and the parent company only statements of comprehensive income, changes

in stockholders' equity, and cash flows for the years ended December 31, 2015 and 2014. The Company' s

management is responsible for the preparation and presentation of the parent company only financial

statements. Our responsibility is to issue a report on these financial statements based on our audits.

We conducted our audits in accordance with the "Rules Governing the Audit of Financial Statements by

Certified Public Accountants" and auditing standards generally accepted in the Republic of China. Those

rules and standards require that we plan and perform the audit to obtain reasonable assurance about

whether the financial statements are free of material misstatement. An audit includes examining, on a test

basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes

assessing the accounting principles used and significant estimates made by management, as well as

evaluating the overall financial statement presentation. We believe that our audits provide a reasonable

basis for our opinion.

In our opinion, the parent company only financial statements referred to in the first paragraph present fairly,

in all material respects, the parent company only financial position of Quanta Computer Inc. as of

December 31, 2015 and 2014, and the results of its operations and its cash flows for the years then ended,

in conformity with the Guidelines Governing the Preparation of Financial Reports by Securities Issuers.

KPMG

CPA： Chiang, Chung Yi

Yang, Leou Fong

Taipei, Taiwan, R.O.C.

March 31, 2016

Note to Readers

The accompanying financial statements are intended only to present the financial position, results of operations and

cash flows in accordance with the International Financial Reporting Standards approved by the R.O.C Financial

Supervisory Commissions and not those of any other jurisdictions. The standards, procedures, and practices to audit

such financial statements are those generally accepted and applied in the Republic of China.

The auditors' report and the accompanying financial statements are the English translation of the Chinese version

prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of,

the English and Chinese language auditors’ report and financial statements, the Chinese version shall prevail.

(English Translation of Financial Report Originally Issued In Chinese)

Independent Auditors’ Report

The Board of Directors of Quanta Computer Inc.：

We have audited the accompanying consolidated balance sheets of Quanta Computer Inc. and its subsidiaries

(“the Group”) as of December 31, 2015 and 2014, and the consolidated statements of comprehensive income,

changes in stockholders’ equity, and cash flows for the years ended December 31, 2015 and 2014. The

Company’s management is responsible for the preparation and presentation of the consolidated financial

statements. Our responsibility is to issue a report on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the “Rules Governing the Audit of Financial Statements by

Certified Public Accountants” and the auditing standards generally accepted in the Republic of China. Those

rules and standards require that we plan and perform the audit to obtain reasonable assurance about whether the

consolidated financial statements are free of material misstatement. An audit includes examining, on a test basis,

evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the

accounting principles used and significant estimates made by management, as well as evaluating the overall

financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to in the first paragraph present fairly, in all

material respects, the consolidated financial position of Quanta Computer Inc. and its subsidiaries as of

December 31, 2015 and 2014, and the results of their consolidated operations and their consolidated cash flows

for the years then ended, in conformity with the Guidelines Governing the Preparation of Financial Reports by

Securities Issuers and with the International Financial Reporting Standards (IFRSs), International Accounting

Standards (IASs), interpretation as well as related guidance endorsed by the Financial Supervisory Commission

of the Republic of China.

Quanta Computer Inc. has additionally prepared the parent company only financial statements as of and for the

years ended December 31, 2015 and 2014, on which we have issued an unqualified opinion.

KPMG

CPA： Chiang, Chung Yi

Yang, Leou Fong

Taipei, Taiwan, R.O.C.

March 31, 2016

Note to Readers

The accompanying financial statements are intended only to present the financial position, results of operations and cash

flows in accordance with the International Financial Reporting Standards approved by the R.O.C Financial Supervisory

Commissions and not those of any other jurisdictions. The standards, procedures, and practices to audit such financial

statements are those generally accepted and applied in the Republic of China.

The auditors’ report and the accompanying financial statements are the English translation of the Chinese version prepared

and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of, the English and

Chinese language auditors’ report and financial statements, the Chinese version shall prevail.