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Acer sees sales stall

Acer saw sales stall in its second quarter, down 2.2% compared to the first three months of the year.

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Acer saw sales stalll in its second quarter, down 2.2% compared to the first three months of the year.

The Taiwanese company said it didn’t expect revenue to pick up until its fourth quarter.

But Acer will start shipping products for the launch of Microsoft Windows 8 in August and September, therefore anticipates revenues to rebound, and consequently expects third quarter revenues to be about the same as the second quarter, said the company.

The company also said a one-time tax settlement of NT$410m affected its income.

The news follows record sales from Chinese rival Lenovo, which saw a  44% year-over-year in its latest results.

Andrew Buss, service director analyst at Freeform Dynamics said the results reflect a tumultuous last few years at the company.

“Acer had a policy of pile it high and sell it cheap, which worked in the boom time but when the downturn happened it was  left with a lot of stock it had to write off,” he said.

“Also the lower end of the market, which it has typically targeted, has cannibalised by things like iPad, as people look to purchase tablets instead of netbook and lower cost PCs.  

“Alternatively Lenovo has focused on the mid- to upper end of the market and only recently moved into the consumer space.”

Buss said Acer should see an increase in sales with the release of Windows 8, but shouldn’t rely on that as a long-term strategy to improve sales.

“The fundamentals are there for Acer, it is a good company it just needs to refine its business model and be better at identifying trends. And I think it is beginning to do that,” he said.

 

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