Acer Q4 profit falls 40 percent, missing analysts’ estimates

By Tim Culpan Bloomberg

Acer Inc., the world’s fourth-largest personal computer company, had a 40 percent decrease in fourth-quarter profit, missing analysts’ estimates.

Net income fell to NT$1.27 billion from NT$2.1 billion a year earlier, Stella Chou, a spokeswoman for Taipei-based Acer, said by telephone. Profit missed the NT$2.18 billion median estimate of six analysts surveyed by Bloomberg.

Acer’s results follow profit margins at Hewlett-Packard Co. and earnings at Dell Inc. that missed analysts’ estimates, underscoring increasing competition in the US$233 billion global PC market. Acer had last year’s biggest increase in shipments among the world’s five-largest PC vendors after Italian-born President Gianfranco Lanci cut prices.

“We did see a substantial decline in prices for computers,” Steven Tseng, who rates Acer a “sell” for ABN Amro Asia Ltd. in Taipei, said before the results were announced. “They should be able to take the number three spot in the second half of the year.”

For the year, net income rose 21 percent to a record NT$10.22 billion. Revenue increased 16 percent to NT$369.1 billion, the company said in an e-mailed statement.

In a related story, shares of Acer declined after Hewlett Packard Co. filed a suit in the U.S. alleging infringement of five patents.

The stock fell 0.5 percent to NT$64.1 at the close of trade in Taipei. By comparison, Taiwan’s benchmark TAIEX stock index declined 0.7 percent.

Hewlett-Packard, based in Palo Alto, California, filed a suit Tuesday in U.S. District Court in Texas alleging Acer infringed patents, including those related to the management of a computer’s processor and its power system.

“Acer’s legal division is looking into this issue and is unable to comment at this stage,” spokeswoman Stella Chou said in an e-mail.

Acer lags only Dell Inc., Hewlett-Packard and Lenovo Group Ltd. in worldwide market share for personal computers, according to Gartner Inc.