The Channel logo


By | Kieren McCarthy 24th March 2016 19:56

Wobbly Acer goes two-legged to steady itself

Taiwanese PC biz splits into New and Core units as results show shaky recovery

Acer is to split into two in an effort to stabilize an uncertain recovery.

The company will move its "core business" of PCs, servers, tablets and monitors under one umbrella and its "new business" of cloud services, smartphones and wearable devices under another.

The restructuring is the same as we outlined earlier this week, but without a "reinvestment subsidiary."

The news comes as the troubled firm released its 2015 fourth quarter results. They show a company still struggling to find its feet despite what appeared to be a recovery in 2014.

Revenue and profit are down quarter-on-quarter and year-on-year, but in a sign that the company may be headed in the right direction, margins are up and operating costs are down.

"Acer has maintained its profitability and gross profit margin above 9 per cent in 2015," the company said in a statement, "proving the effectiveness of its product mix strategy for different market segments and the focus on high-margin products."

The truth is, however, that the company remains heavily reliant on its PC business, which accounts for more than three-quarters of its revenue (59 per cent laptops; 17 per cent desktops).

Here's how Acer's results stacked up:

  • For Q4, which ended December 31, 2015:
    • Total revenue stood at NT$68.4bn (US$2.1bn), down 20 per cent year-on-year from NT$85.9bn (US$2.64bn). Gross margin was up 0.6 per cent to 9.4 per cent.
    • Operating expenses were down year-on-year from NT$6.6bn to NT$6.0bn (US$204m to US$185m).
    • Profit before tax was NT$151m (US$4.64m), down a whopping 64 per cent from last year's NT$890m (US$27.4m).
    • Earnings per share came in at NT$0.08 (US .25 cents).
  • For the full 2015 year:
    • Total revenue stood at NT$264bn (US$8.1bn), down 20 per cent from NT$330bn (US$10.1bn).
    • Operating expenses were down 8.8 per cent from NT$26.6bn to NT$24.2bn (US$817m to US$745m).
    • Profit before tax was NT$847m (US$26m), down 66 per cent from last year's NT$2.6bn (US$80m).
    • Earnings per share were down from NT$0.66 (US 2 cents) to NT$0.20 (US .6 cents).

Acer will hold its shareholders' meeting on June 24 in Taipei. Its share price barely budged on the news, going up 0.4 per cent. ®

comment icon Read 1 comment on this article or post a comment alert Send corrections


Frank Jennings

What do you do? Use manual typwriters or live in a Scottish croft? Our man advises
A rusty petrol pump at an abandoned gas station. Pic by Silvia B. Jakiello via shutterstock

Trevor Pott

Among other things, Active Directory needs an overhaul
Baby looks taken aback/shocked/affronted. Photo by Shutterstock

Kat Hall

Plans for 2 million FTTP connections in next four years 'not enough'
Microsoft CEO Satya Nadella


Suit-and-tie-wearing man tries to meditate, take deep breaths in faux yoga pose. Photo by Shutterstock
Emotional intelligence, not tech skills, is the way to woo suits
League of gentlemen poster - Tubbs and Edward at the local shop. Copyright BBC
One reselling man tells his tale of woe