[News] Taiwanese Server Giant Wiwynn Sues Musk’s X for Unpaid Bills, Echoing MiTAC’s Past Payment Disputes

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As per a report from Business Insider, Taiwanese AI server giant Wiwynn has filed a lawsuit against Elon Musk’s social platform X (formerly Twitter), claiming it refused to pay USD 120 million for parts. However, this may not be the first time a major Taiwanese server manufacturer has encountered payment disputes with X.

According to a report from Economic Daily News, in the fourth quarter of 2022, MiTAC also faced issues when Musk took over Twitter, potentially leading to unpaid server bills.

After Musk took over Twitter, he aggressively implemented cost-cutting strategies, including layoffs and renegotiating orders with suppliers. MiTAC, as one of Twitter’s server suppliers, might also be impacted, recording a NTD 1.4 billion (around USD 44 million) write-down in inventory and bad debt provisions for accounts receivable in the fourth quarter of 2022.

This directly resulted in a NTD 346 million (roughly USD 10.8 million) loss for that quarter, marking only the second time MiTAC has reported a quarterly loss since its public listing.

Still, due to confidentiality, MiTAC has not disclosed the names of clients with delayed payments.

After navigating the downturn in Q4 2022, MiTAC saw a significant rebound in Q2 2023. During the traditionally slow season for servers, the company achieved notable growth in net profit, with a quarterly increase of 367.11% and a year-over-year increase of 34.72%, reaching an EPS of NT$0.59.

It is reported by Economic Daily News that the surge in profits was largely due to partial payments received from X. Additionally, MiTAC managed to either resell the components it previously reserved for X or retrieve them, which contributed to its soaring quarterly profits.

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(Photo credit: MiTAC)