TAIPEI Aug 17 Taiwan's Acer Inc
posted on Friday a second-quarter net profit much worse than
analysts had forecast after it made a one-time tax settlement in
Europe and warned the PC industry will see slower-than-expected
growth in the second half due to the uncertainty of the Windows
The world's No.3 PC vendor by shipments has been betting on
Microsoft new Windows 8 operating system and Intel's
ultrabooks, super-thin laptops similar to Apple Inc's
MacBook Air, to revive sales as tablet computers chip
away at the PC's dominance.
Acer forecast revenue in the third quarter would be flat,
but said fourth-quarter revenue should grow 5-10 percent.
"We originally expected high growth in the second half, but
because of the global economic situation and the uncertainty of
the Windows 8 ecosystem, the big growth expectation turned out
to be medium growth," Acer's chairman and CEO, J.T. Wang, told
investors on a conference call.
He said customers have been cautious towards the Windows 8
product launch, which translated into a lack of "explosive
growth" in the market.
Acer was one of the first companies to criticise Microsoft
for moving into the computer hardware business with the pending
launch of its Surface tablet computer.
Wang said Microsoft's move would have a negative impact on
the software giant's hardware partners and said he doubted
Microsoft could rival Apple or other hardware makers.
Acer said on Friday its net profit in April-June was T$56
million ($1.87 million), far below the T$550 million profit
forecast by 19 analysts polled by Thomson Reuters I/B/E/S.
The figure compares to a net profit of T$331 million in the
first quarter and a net loss of T$$6.79 billion in the same
quarter a year earlier. The company said the tax payment in
Europe was for T$410 million, attributing it to an assessment
discrepancy with Italian tax authorities.
The company's operating margin climbed 0.3 percentage points
to 0.4 percent from the first quarter. Acer President Jim Wong
said margins will be maintained at similar levels due to
Shares of Acer slipped 0.9 percent on Friday, versus a 0.3
percent fall in the broader market.
Analysts have expressed concerns about Acer's growth
momentum through the second half as rivals such as Lenovo Group
and Samsung Electronics push aggressively
into Europe and as China's PC market slows. They have also
expressed concerns over Acer's competitiveness in Windows 8
JP Morgan said "Acer is likely to lag behind the competition
in the Windows 8 product cycle, especially for new form factors
such as tablets and convertibles...Acer notably doesn't figure
as a leading partner for Microsoft in Windows, leading to
further share losses."
The latest data by industry researcher Gartner shows Acer
retained its No.2 position in the second quarter in Western
Europe, a market where the Taiwanese vendor has demonstrated a
strong presence with a market share of 17.3 percent, up from
14.6 percent from a year ago.
PC shipments in Western Europe declined 2.4 percent in the
second quarter from a year ago, according to Gartner, while
worldwide shipments were flat.
"Acer will start shipping products for the launch of
Microsoft Windows 8 in August and September (and) therefore
anticipates revenues to rebound," the company said earlier in a
Acer said it will introduce two models at the launch of
Windows 8 and plans to roll out Windows RT - tablets based on
Microsoft's new system using ARM chip architecture early
The company also said it is aiming for ultrabooks to account
for 12-20 percent of notebook shipments by the end of the year.