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Acer's PC sales dropped by almost 35 percent in the quarter

Tech CEOs seem to be dropping like flies this week as yet another resigns from their post. 

According to Yahoo NewsAcer Inc. Chairman and CEO J.T. Wang resigned after the company posted disappointing third quarter financial results. Wang is expected to step down as CEO on January 1, 2014, but will keep his position as chairman until the second quarter of 2014. 

Acer President Jim Wong will take over as CEO in January once Wang leaves the post. 

Reports say Wang is leaving due to recent financial losses and struggling PC sales. For Q3 2013, Acer posted a wider-than-expected net loss of T$13.12 billion ($446 million USD). Analysts only expected a loss of around T$109 million for the quarter. Acer's PC sales also dropped by almost 35 percent in the quarter as well.

Acer CEO J.T. Wang

"Q3's operating loss was mainly due to the gross margin impact of gearing up for the Windows 8.1 sell-in and the related management of inventory," said Acer in a statement.

Acer added that there was an intangible asset impairment loss of T$9.94 billion for Q3, which includes trademarks and goodwill. 

As a result, the company plans to cut its global staff by 7 percent in an effort to save $100 million in annual operating expenses. 

What's interesting to note is that IDC said the top three PC makers (Lenovo, HP and Dell) saw small growth in PCs during the third quarter. 

Just yesterday, BlackBerry reported that its CEO, Thorsten Heins, would be resigning as well. The news came amid the announcement of a $1 billion investment from Fairfax Financial Holdings Limited and other institutional investors instead of the original $4.7 billion buyout. 

Source: Yahoo News

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Oh Acer
By Nortel on 11/5/13, Rating: 0
RE: Oh Acer
By crispbp04 on 11/5/2013 10:11:51 AM , Rating: 3
It's nothing to do with Windows 8. Your first two points are wrong. Lenovo and Asus proved that. Your last 3 points are valid.

They rode on the coat tail of Microsoft like the majority of consumer PC OEMs over the past 10 years. And they wonder why Microsoft entered the hardware game. Their operating system had been bastardized and raped by OEM bloatware and lackluster, if not inferior hardware.

People care about quality over specs. Surface sets a baseline for what can be done, and it should be set at a premium price. It should has been encouraging to companies like Acer to innovate and create the same experience in a cheaper package... Instead Acer called foul when Microsoft released their own hardware.

Look at them now... they are failing not because of Microsoft's Windows, but their own failure to provide customers with the hardware experience they expect for their hard earned cash.

This is no perfect storm, it's the failure of a company that never had it right to begin with, and only took advantage of consumers in a market that allowed companies to sell junky products. A market that no longer exists, thanks to the evolution of the mobile market.

RE: Oh Acer
By YearOfTheDingo on 11/5/13, Rating: 0
RE: Oh Acer
By Samus on 11/5/2013 1:17:43 PM , Rating: 2
Lenovo and HP make Acer irrelevant because the former make products price-competitive with the later at better quality. I wouldn't consider Asus products significantly higher quality than Acer (although I'd prefer them over Acer) because they have their quirks too.

I've had a number of Zenbooks in for repair. One needed a new motherboard because the RTC was too fast. I can't recall the last time I'd seen a clock fail. Just crazy cheap problems.

I still think the HP Folio\Elitebook\Probook and Lenovo Thinkpad X\T\Ideapad Y-series are the best bet's out there. That Y410 is probably the best value in gaming notebook, even with cheap plastic and a gamerboy red-backlit keyboard.

But nobody has ever, and ever will, take Acer seriously in the business/enterprise sector, and that's the sector that continues buying profitable PC's.

RE: Oh Acer
By YearOfTheDingo on 11/5/2013 2:54:07 PM , Rating: 1
Acer is cheap and their computers look nice. That has always been enough to get less-informed consumers to open their wallets. What changed is Windows 8. Running on lower-end machine it feels plainly broken. Prospective buyer pokes the screen, sees nothing happening, and walks away. The Start screen is like a sign reading "I suck. Don't buy me."

RE: Oh Acer
By crispbp04 on 11/5/2013 1:50:35 PM , Rating: 2
Citing Windows 8 as a reason for the decline in sales is easily refutable because you would see a decline across the board. Since the article clearly cites that three major OEMS grew in the 3rd quarter, Acer's 30% drop is clearly due to their own failure. Your argument is ignorant and has no factual information to back your stupid conclusions.

The last sentence you typed is so dumb that I don't even know why I'm wasting my time responding.
Acer sold a tons of low margin netbooks that ended up in the junk pile before there were any tablets in the market. Hurray for them, they filled the bottom of the barrel for a short amount of time, and you try to use that as a comparison to today's market where the low end is dominated by tablets? Why would you even try to be an Acer apologist? They lacked vision, they are a purely reactive scum sucking maggot of the industry. It's disgusting that people like you try to blame Windows 8 as the reason as to why companies like Acer are failing. Their halfway decent S7 is too little too late.

Windows 8 is an excellent operating system and the hardware refresh with 8.1 will finally highlight what it's capable of doing.

Q4 will undoubtedly show a surge of sales of tablets, convertibles, and laptops based on haswell, bay trail, and tegra4/snapdragon 800, and then you can go cry in the corner with your MacBook. By the beginning of next year, Apple will be the only manufacturer selling a product that doesn't have a touchscreen.

RE: Oh Acer
By Helbore on 11/5/2013 10:17:40 AM , Rating: 2
People ARE buying PCs. Sales might be down year-on-year, but they're still selling in the tens of millions. Windows 8 is also selling enough to preclude the notion that "no-one wants it."

I'd agree with your other points, though. Acer just doesn't innovate and produces terrible quality products. Not that long ago I worked in the IT department of a company that decided to buy 900 Acer computers. IT was enough to make me despise the company and vow to never buy any product produced by them. I just don't trust their build quality, no matter how much they might try and pretty up its external appearance.

Other PC makers are seeing small growth in sales. Acer's sales are down because their hardware just isn't good enough. I also think that idiot of a CEO made a bitt too much of a public fool of himself when he went on a bitching-spree about Surface. He just shone a spotlight on his own company's poorer-quality products.

RE: Oh Acer
By ven1ger on 11/5/2013 8:04:36 PM , Rating: 2
Do you have a figure of how many computers being sold with Windows 8 and how many people are actually buying Windows 8 without a computer purchase? The numbers may be a lot different than you think. When Vista came out, computers were being sold with Vista, but every machine we purchased we made sure that it was able to downgrade to Win XP.

RE: Oh Acer
By damianrobertjones on 11/5/2013 11:44:28 AM , Rating: 2
Gerry Smith, Lenovo, "the industry underestimated touch screen demand, sales of premium-priced computers are growing and Lenovo is growing"

Yeah... that would be with Windows 8. Just stop it already

RE: Oh Acer
By Motoman on 11/5/2013 12:12:22 PM , Rating: 2
-Terrible quality products

Nah. I've personally been using an Acer laptop for a couple years now - it's been awesome. I've also sold a large number of them over the past few years...they've been more reliable than anything else. Acer has probably been killing itself on margin by selling a better machine for less money than anyone else on a regular basis...but that model only works when you keep volume up.

-Only creates 'me-too' products

Ummm...they're computers. There's not a lot of variation available, but as far as I can tell, Acer makes pretty much every variation that anyone else does. You could accuse any PC maker of only making "me-too" products.

-Zero innovation

Compared to what other PC maker? They do pretty much what everyone else does - which is just as valid as saying everyone else does pretty much what Acer does.

As for no one wanting Win8 - as a rule that's true, but people still have to buy computers, so they're buying Win8 because that's what's available. If you need a computer you need a computer. There is a downtick in people buying desktop and/or laptop computers, but they're picking up by buying other computer formats - like tablets, smartphones, and newer formfactors like convertibles. Acer makes all of those if they're not picking up on the newer devices like other more successful PC makers, that's their fault somehow. From a product standpoint, they've got all the bases covered.

I don't know what the explanation is for Acer's downfall...but I don't believe it's any of the points you provided. I'd guess at poor or non-existent marketing and bad partnering with retailers to start...

RE: Oh Acer
By troysavary on 11/5/2013 1:39:19 PM , Rating: 2
You are the first person I have seen claim that Acer made good products. My Gateway (by Acer) notebook was literally falling apart within a year of buying it. The first power supply died, and Future Shop, rather than give me another Acer power supply, since they were failing so often, just gave me one of those universal ones with the interchangeable plugs as the warranty replacement. The power button in the hinge popped out completely shortly after the warranty period ended, leaving me with two wires hanging out that I now touch together to start the laptop. The keys started falling off the keyboard. And to top it off, the battery stopped holding a charge for more than 5 minutes, giving me just enough battery power to move from one room to another before plugging it back in.

RE: Oh Acer
By Motoman on 11/5/2013 2:20:40 PM , Rating: 2
So your one experience with a bad product means the entire company is bad? Anecdata. Granted, mine is anecdata too, but I include in that a number of customers I've sold Acer laptops to as well.

Beyond that, all you can do is try to find some kind of reliability poll. This one was from earlier this year, for example:

Here's their list of customer satisfaction by brand:

Apple: 19%
Dell: 12%
Asus: 11%
HP: 11%
Acer: 9%
Lenovo: 9%
Toshiba: 9%
Samsung: 7%
Sony: 6%
Alienware: 3%
Fujitsu: 1%
MSI: 1%
Panasonic: 1%

Apple is never a number I believe...the reality distortion field is ridiculous. I see a never-ending stream of people with faulty and/or broken iThings who nevertheless rave about how *awesome* Apple is. I'm pretty sure if their iThings gave them cancer, they'd still rate Apple as the best company on the planet.

There's vast numbers of such polls that have been done by world + they vary quite a bit. In the end I think the only rational conclusion one can come to is that Acer is not any better, or any worse, than anyone else.

Also, if FS didn't give you the correct replacement part under warranty, that's hardly Acer's fault.

RE: Oh Acer
By vision33r on 11/5/2013 10:15:10 PM , Rating: 2
There's no reality distortion field, Apple hardware has is much better than the rest of the industry and that's a fact. Even Anand can appreciate how well design and quality Apple uses compare to all the cheap commodity designed PCs.

RE: Oh Acer
By StevoLincolnite on 11/6/2013 4:28:03 AM , Rating: 2
I have a 15 year old notebook, still works today, even replaced the battery for $30 off ebay a few times during it's life.
That's reliable and well designed. And it's an Acer, running Windows NT on a Pentium 3.
And it's still used heavily as a file server. :)

When I had a Macbook Pro, the battery died, when the machine was dissected it was like a balloon, sure enough couple hundred bucks later it was running fine.
That is until the CCFL backlight died a few months later.

So not only was it more unreliable, it was more expensive in it's initial purchase, it was more expensive to repair and didn't last the distance.

Lets not forget all the drama's Apple had with yellow tinted screens either.
Or the drives failing in it's iPods.
Or advertising higher battery life than was obtainable with the iPod.
Or how iPads would over-heat and shut down when used in the sun.
Or how "you held it wrong" with the iPhone 4's antenna.
Or iDevices that have caught fire and/or exploded.

You make it sound as if Apple is immune to faults, it's laughable and simply not true.
You are essentially paying an over priced "fee" for a special logo and a customer service line that will transfer you to a dozen different departments.

Windows, Android and in some cases Windows Phone devices are easily superior to anything Apple has both in build quality, performance and price if you shop around.

RE: Oh Acer
By inperfectdarkness on 11/6/2013 4:07:38 AM , Rating: 2
I don't believe the accuracy of that. MSI at 1% customer satisfaction? Whatever. They may have cheap-looking cases & gimmicky adornments, but they work...and work well. I've had mine since Dec 2010 & it's worked great without a hiccough. Granted, I'm meticulous about using virus protection, and killing off spyware, etc. (I also use ABP, NoScript, Ghostery, etc...on FF).

I guarantee MSI is way more reliable than Apple. Take that "survey" with a grain of salt.

RE: Oh Acer
By inperfectdarkness on 11/6/2013 4:12:17 AM , Rating: 2
It's also important to note that--as the article noted--people voted for their favorite brands. On that basis alone, I'm not surprised Apple came out on top. It also looks like people were only able to vote for 1 brand. I would also assert that about 99% of consumers probably don't know MSI exists (at least in the "western" countries").

In fact, that entire list almost reads like what you would expect if you asked people about name-brand-recognition. Not even remotely scientific. Popularity contest, I'd say--nothing more.

RE: Oh Acer
By Motoman on 11/6/2013 3:09:30 PM , Rating: 2
All polls are popularity contests.

Consumers all have opinions about what the "best" is for any given category of product. Those opinions are colored by various factors, such as personal product experience, the experience of friends and family, social pressures, etc. This is true of *all* surveys and polls.

RE: Oh Acer
By Motoman on 11/6/2013 3:07:51 PM , Rating: 2
Your failure is complete. MSI is not listed at "1% customer satisfaction."

1% of all respondents, a little under 6,000, selected MSI as the answer to this question:

What is the most reliable laptop company?

9% of all respondents said Acer was the most reliable. 1% said MSI was the most reliable. So on and so forth.

And I would also guarantee that MSI is more reliable than Apple, and I posted my distrust of all Apple numbers to start with.

Bottom of the Barrel
By foxalopex on 11/5/2013 12:19:26 PM , Rating: 2
I think the problem with Acer is that for years they put out inexpensive, low quality products. It made their brand name mean cheap and crappy. The problem with ultimate bottom of the barrel is that the margins are incredibly thin to the point where if anything goes wrong. (Weaker PC sales / Windows 8 ) then your profit tanks.

Acer realized this problem sometime ago and tried desperately to increase their quality by putting out some high end laptops from what I recall. The problem is it's very hard to improve your brand's image once you've tarnished it.

So the results shouldn't entirely be a surprise.

RE: Bottom of the Barrel
By Murloc on 11/5/2013 2:01:33 PM , Rating: 2
yeah this.
Low quality and prices, lots of products sold to people looking for the cheapest thing, but not enough margin.

Also they're kinda doomed because tablets and smartphones kinda removed the need for netbooks or other cheap stuff with no performance and low usability.
What are they left with? Cheap monitors, cheap mall computers. Low margins, and people with knowledge just avoid them.

J.T.'s problem
By johnnycanadian on 11/5/2013 10:37:49 AM , Rating: 1
I guess he simply Wang the Wong number.

I stink.

RE: J.T.'s problem
By Doh! on 11/5/2013 12:13:03 PM , Rating: 2
You're such a racist.

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