Micronics
| Company type | Public (from 1991) |
|---|---|
| Industry | Computer hardware |
| Founded | November 1986 |
| Founder | Frank Lin, Dean Chang, Harvey Wong, Minsiu Huang |
| Defunct | 1998 |
| Fate | Acquired by Diamond Multimedia |
| Headquarters | Mountain View, California (initially); later Fremont, California , United States |
Area served | United States |
Key people | Frank Lin (co-founder, former CEO), Chuck C. Chan (CEO), Steven P. Kitrosser (CEO), Shanker Munshani (Chairman), William E. Shelander (Chairman) |
| Products | Computer systems, motherboards, peripheral devices, graphics adapters, sound cards |
Number of employees | 215 (1991) |
Micronics Computers, Inc. was a U.S.-based computer manufacturer operating from 1986 until 1998, specializing in complete computer systems, motherboards, and peripheral devices. Headquartered in the San Francisco Bay Area, it ranked among the largest domestic motherboard producers during the 1990s. Following its 1994 acquisition of Orchid Technology, Micronics broadened its product range to include multimedia components such as graphics adapters and sound cards. The company was ultimately purchased by Diamond Multimedia in 1998.
Establishment and Expansion (1986–1992)
Micronics was established in November 1986 in Mountain View, California by Taiwanese-American engineers Frank Lin, Dean Chang, Harvey Wong, and Minsiu Huang. Initially functioning as an OEM supplier of IBM PC compatible motherboards aimed at system integrators, Lin and Chang developed the enterprise while employed at other Silicon Valley companies. Together with Wong and Huang, they combined $150,000 to formally incorporate the business. The company’s early offerings included Intel 80286- and i386-based motherboards, with the i386 variant recognized for being the most affordable option available while maintaining strong performance and upgrade capabilities.
Initial capital injections totaling $250,000 from investors in the U.S. and Taiwan facilitated swift sales growth—achieving $4 million in motherboard revenue within nine months and generating $170,000 in profit. In 1989, Micronics introduced its first Extended Industry Standard Architecture (EISA) motherboard, aligning with industry shifts initiated by Compaq. By 1990, the company launched i486-based motherboards and secured an additional $5 million in funding from investors located in the United States, Hong Kong, and Japan.
By early 1991, Micronics had moved into a larger facility in Fremont with a workforce of 215 employees and anticipated revenues approaching $100 million for that year. That January marked the debut of their X terminal series—the 3X and 4X models—powered by i386 and i486 processors respectively, capable of operating as MS-DOS workstations with proprietary X Window System server software. In August 1991, Micronics signed a $4 million component supply agreement with Alpha Microsystems based in Santa Ana. The same year saw the release of their inaugural portable computer, the Mport 325: featuring a clamshell design equipped with a 25 MHz i386 CPU and a 6.9-inch monochrome LCD screen; however, it lacked an integrated battery.
Leadership Changes and Orchid Acquisition (1992–1995)
Micronics went public in 1991. Co-founder Huang took a leave of absence from late 1991 until mid-1992 before returning to the board as president. Meanwhile, CEO Lin retired in May 1992 and was succeeded by Chuck C. Chan. Shortly thereafter, Dado Banatao—founder of graphics chipset companies Chips and Technologies and S3 Incorporated—joined Micronics' board of directors. By 1994, Steven P. Kitrosser, formerly affiliated with Digital Equipment Corporation, replaced Chan as CEO. In April that year, co-founder Chang departed to establish Premax Electronics, a PC Card manufacturing firm located in Sunnyvale.
In June 1994, Micronics acquired Orchid Technology, a Fremont-based multimedia peripherals manufacturer; Orchid continued operating as a subsidiary under its own brand name. This strategic acquisition allowed Micronics to diversify into graphics adapters and sound cards while enabling Orchid to advance digital video technology products. Founded in 1982 by Le Bui and employing approximately 100 staff at the time of purchase, Orchid completed the transaction by August 1994 without any workforce reductions.
In October 1994, IBM launched the PC Server 300 which incorporated a Micronics motherboard featuring Intel DX2 or Pentium processors clocked at 60 MHz—an uncommon instance where IBM utilized a third-party motherboard within its PCs. This motherboard employed the Peripheral Component Interconnect bus instead of IBM’s proprietary Micro Channel architecture. Micronics also marketed this motherboard both directly to other manufacturers and as an individual product. In 1995, IBM once again contracted Micronics to produce the PC Server 320 motherboard offering dual Pentium sockets; IBM manufactured the Micro Channel version themselves while Micronics supplied the EISA bus variant.
Micronics' Downturn and Acquisition by Diamond (1995–1998)
In 1995, Micronics encountered significant financial difficulties, influenced in part by the collapse of its primary client, Osborne Computer Corporation, which entered receivership in Australia following its earlier bankruptcy in the United States. The company recorded a loss of $13.7 million during the first half of that year. By October, leadership shifts occurred as former executives from Orchid assumed pivotal positions, coinciding with the resignation of half the board members. During this period, Micronics purchased the remaining 20 percent stake in Osborne, while Gateway 2000 acquired the majority 80 percent share.
By October 1996, shareholders holding a 10 percent stake called for Micronics to pursue either a sale or a merger. The financial reports revealed aggregate losses amounting to $26.1 million over 1995 and 1996. Toward the end of 1996, Micronics introduced a new division dedicated to networked workstations and servers, launching midtower systems equipped with single or dual Pentium Pro processors in early 1997.
In mid-1997, the company considered acquiring Hayes Microcomputer Products, a manufacturer of networking hardware facing financial challenges; however, negotiations concluded without an agreement. Despite ongoing initiatives, losses persisted, with $5.4 million reported between February and September 1997. That September also saw the resignation of Chairman Shanker Munshani, who was succeeded by William E. Shelander.
In July 1998, Shelander consented to sell Micronics to Diamond Multimedia for roughly $32 million. Following the acquisition, Diamond consolidated Micronics' employees at its San Jose headquarters and maintained the Micronics brand as a sub-label for some time thereafter.