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Acer-Shih

From the late 1990s through the mid-2000s, Acer, the low-cost Chinese OEM, rose like a rocket. It spun off multiple successful companies like BenQ and Wistron, while visitor revenues rose from $iv.9 billion in 2003 to $11.31 billion in 2006. Nine years later, however, the company is in a shambles. Its honorary chair and founder, Stan Shih, who began the company with $25,000 in capital in 1976, has announced that a buyout or takeover bid would be welcome.

Acer lost $ninety million in the first half of its electric current financial yr. Fleck-Tech reports that sales have fallen 33% in the past month and its share price stands at half of where information technology was in April. Despite these massive headwinds, Acer remains the fifth-largest PC OEM in the world — a stunning reminder that the bottom has fallen out of the PC business concern to such a degree that even the largest vendors aren't making whatever money.

Profits

This chart, created past The Overspill, shows how PC cyberspace incomes have plummeted. HP sells billions of revenue in PCs per quarter just earns very lilliputian on the business.

When Shih was asked if Acer would be interested in entertaining whatever offers that companies similar Dell or HP might make, Shih told reporters that such involvement would be welcome. What's a bit more than puzzling, all the same, is that Shih went on to say that any company that bought Acer would pay dearly for purchasing an "empty shell."

"U.Southward. and European management teams usually are concerned virtually money, their CEOs just work for money. But Taiwanese are more concerned about a sense of mission and emotional factors," he said.

Shi's remarks were afterward confirmed by a visitor spokesperson, but I'm wondering if some nuance of context isn't getting lost in communication. Acer may have taken a beating in recent months, but the visitor still reported revenue of $i.94B in its Q2 2022 report. That'south no small amount of acquirement, fifty-fifty if information technology'due south not in the aforementioned ballpark as what the largest OEMs typically make. Information technology's plenty cash to make it unclear why the founder of the company would characterize it as an "empty beat out," peculiarly when such phrasing would damage the chances of a successful sale or merger.

Concluding yr, Acer's CEO, Jason Chen, declared that Acer would bet the future of the company on the ascendence of Chromebooks and hybrid 2-in-1 devices. Judging by the company's latest sales results, those initiatives have failed. Acer'south problems are a perfect representation of the deep issues facing the entire PC business. While hundreds of millions of devices proceed to ship on a yearly basis, PC margins have fallen to the indicate that just a handful of companies can earn coin in the business organisation. What that means for the future of the entire industry is unclear, but consumer PC sales are no longer expected to recover until some betoken after 2022.