Thu, Apr 30, 2009 - Page 12 News List

Acer targeting smartphone market

CHANGE OF TACK Reporting a 31.4 percent decline in first-quarter profits, the firm took a sharp departure from previous statements on dominating the PC market

By Elizabeth Tchii  /  STAFF REPORTER

With unfavorable foreign exchange rates and a tightening credit capacity, Acer Inc (宏碁) reported a 31.4 percent drop in net profits for the first quarter compared with the same period last year, the company said yesterday.

Net profits were NT$2.03 billion (US$61 million) in the first three months, or NT$0.78 earnings per share, compared with NT$2.95 billion a year earlier.

Revenues and operating income also declined 7 percent and 6 percent year-on-year to NT$119.09 billion and NT$2.57 billion respectively in the first quarter.

The world’s third-largest personal computer and second-largest notebook vendor lowered its forecast for netbook shipments for this year to between 10 million and 12 million units from 12 million to 15 million units at an investor conference yesterday and said that netbooks would not contribute to revenues in the second quarter.

Acer president Gianfranco Lanci said the company was not considering producing Android-based notebooks, as it sees it as more of a smartphone platform than a heavy-duty computing platform.

The Taipei-based brand aims to be the world’s No. 1 notebook vendor by 2011, taking the emphasis off being No. 1 in total PC sales as the desktop PC business continues its steady decline, Lanci said.

Lanci said Acer’s main focus was to be the global leader in smartphones and be No. 1 in that market by next year, which is a sharp departure from the firm’s previous statements on PC dominance.

Last year, Acer’s PC shipments grew 26.7 percent year-on-year, compared with Hewlett-Packard Co’s 2.6 percent rise and a decline of 6 percent at Dell Inc, data provided by Gartner Inc showed.

Without giving specific guidance for the second quarter, the company said gross margin would remain at 2.2 percent.

“Acer expects 50 percent of revenues to come from the Aspire Timeline series of notebooks this year,” Acer chairman Wang Jeng-tang (王振堂) said.

Going forward, Wang believes Acer is setting new standards in global computing with its Timeline series running on Intel Corp’s consumer ultra-low voltage (CULV) platform and is ahead of the game by six to nine months.

He also stands by Acer’s multi-brand strategy.

“As PCs become a commodity, a single brand simply cannot cover all the user categories. With five to six pricing points, we have clearly delineated the brands and products to grow our global market share,” Wang said.

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