Shares in Acer Inc (宏碁), one of the world’s top three PC brands, tumbled by 4.83 percent to NT$57.1 yesterday — despite a planned buyback of 54 million shares — after the company announced on Thursday that chief executive and president Gianfranco Lanci had stepped down.
Acer shares have fallen more than 20 percent since the company lowered its guidance on first and second quarter revenue on March 25, Taiwan Stock Exchange data showed.
Acer is one of the more internationalized Taiwanese companies and many investors have been impressed by the firm’s execution of its plans and its focus in the past, JPMorgan said in a note.
Photo: Sam Yeh, AFP
“Acer’s new management has its work cut out to win back investor confidence in future execution capability and to do so without further damage to the European business,” JPMorgan said.
While chairman Wang Jeng-tang (王振堂), who will temporarily take over as chief executive, said Acer would increase its focus on mobile devices, including smartphones and tablets, securities brokerages yesterday said the departure of Lanci was only one of many looming uncertainties the company is facing.
“If tablet PCs becomes a bigger market than notebooks, just as Apple Inc and Acer have indicated, Acer could potentially become a much smaller company in the next few years,” Citigroup Global Markets analyst Kevin Chang (張凱偉) said in a report. “We see no reason for PC companies to succeed in the tablet PC space unless they are willing to take a lower margin than handset players so they can offer lower prices, which does not seem sustainable.”
Stan Shih (施振榮) — the founder of Acer Group (宏碁集團), which also includes BenQ Corp (明基) and Wistron Corp (緯創) — said on Thursday in an open letter to the media that the impact of recent drastic changes in the PC industry, especially the rise of smartphones and tablet PCs, had been far greater than expected.
Acer must not just focus on pushing shipments of desktops and PCs as it aims to become the world’s No. 1 PC player, as that would negatively impact its profitability, he said.
Goldman Sachs said the company is facing “long-term challenges” and maintained its sell rating on Acer shares, with a 12-month target price of NT$48.
“Regardless of the management changes, iPad’s cannibalization of the notebook sector and a tough competitive environment are still long-term challenges for Acer,” Goldman Sachs analyst Henry King (金文衡) said in a report.
Instead, Goldman said it preferred Asustek shares, saying the company would have better profitability and could gain further market share — especially in Europe — while Acer is restructuring its business and management structure.
Asustek shares fell 2.55 percent to NT$248 yesterday.
Goldman maintained its buy rating on Asustek, with a NT$309 target price, its report said.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
Thousands of parents in Singapore are furious after a Cordlife Group Ltd (康盛人生集團), a major operator of cord blood banks in Asia, irreparably damaged their children’s samples through improper handling, with some now pursuing legal action. The ongoing case, one of the worst to hit the largely untested industry, has renewed concerns over companies marketing themselves to anxious parents with mostly unproven assurances. This has implications across the region, given Cordlife’s operations in Hong Kong, Macau, Indonesia, the Philippines and India. The parents paid for years to have their infants’ cord blood stored, with the understanding that the stem cells they contained
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day