Acer reports 17% profit increase


Wed, Apr 01, 2009 - Page 11

Acer Inc (宏碁), the world’s third- largest maker of personal computers, reported a 17 percent increase in fourth-quarter profit after grabbing market share with its low-cost netbook and cutting expenses.

Net income climbed to NT$2.81 billion (US$83 million), or NT$1.08 per share, from NT$2.4 billion, or NT$0.99, a year earlier, the Taipei-based company said in a statement yesterday.

Profit missed the NT$2.97 billion median of 11 analyst estimates compiled by Bloomberg News.

Sales of the Aspire One netbook and acquisitions helped boost Acer’s market share by 2.4 percentage points in the period at the expense of Dell Inc and Lenovo Group Ltd (聯想), researcher IDC said.

The company may extend gains as the global recession prompts consumers to switch to netbooks, compact computers that sell for less than half the price of standard notebooks.

“As the consumer’s interest moves to favor the value segment, we expect Acer to continue its aggressive market share gains in 2009,” Jenny Lai (賴惠娟), who rates the company “buy” at CLSA Asia-Pacific Markets in Taipei, wrote in a report on Monday.

Revenue for the period dropped 8 percent to NT$135 billion after the July introduction of the Aspire One, an ultra-compact model that retails for about US$400, and the global economic downturn prompted consumers to switch to cheaper computers. Acer held around 45 percent of the netbook market during the period, CLSA estimates showed.

Fourth-quarter operating profit climbed 15 percent from a year earlier to NT$3.98 billion, while operating margin was 2.94 percent, Acer said in the statement.

Acer’s shares have added 20 percent this year to close at NT$51, outpacing a 14 percent advance in the benchmark TAIEX index.

The Taiwanese company took the top spot in the netbook segment from Asustek Computer Inc (華碩電腦) which inspired the market with its own Eee PC low-cost laptop in October 2007.

Other netbook makers including Hewlett-Packard Co, Dell and Lenovo held a combined market share of about 20 percent, Taipei-based Market Intelligence and Consulting Institute said.

Acer’s computer shipments climbed 25 percent during the fourth quarter, the most among the top five vendors, allowing it to climb to 11.8 percent of the market, IDC said on Jan. 14. Hewlett-Packard and Dell maintained their lead amid a 0.4 percent decline in global sales by units.

Overall computer shipments will drop 4.5 percent this year, while notebooks will climb 4.3 percent, IDC forecast on March 5.

Netbook sales will almost double this year to 21 million units, even as the total PC market shrinks 12 percent, researcher Gartner Inc said last month.

Gains of as much as 10 percent in some markets will help Acer add 2 percentage points to 3 percentage points to its global laptop share this year, it said on Feb. 23.

Notebooks contribute about 65 percent of the company’s revenue.

Acer’s release last month of a 10-inch version of its Aspire One model and four new mobile phones will help boost sales this year, Vincent Chen (陳豊丰), who rates the stock “buy” at Yuanta Financial Holding Co (元大金控), wrote in a March 24 report.

Rebounding Russian and European currencies could also help boost demand in those markets, he wrote.