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Acer to Raise PC Prices in Mid-November Amid Shortage of Hard Drives

2011/11/04 | By Steve Chuang

Taipei, Nov. 4, 2011 (CENS)--To counter the coming shortage of hard drives caused by Thai floods, Acer Inc., a leading PC supplier in Taiwan, has planned to raise its PC prices in mid-November, although the move may undermine its PC sales in the fourth quarter of this year, confirmed the chairman J.T. Wang at an institutional investor conference.

The Thai floods have impacted the global PC industry, as 25% of hard drives are manufactured in the country. The result is that prices of the PC component have started rising, prompting global PC suppliers to consider raising PC prices to counter.

Wang said that the price adjustment is expected to make his company's overall PC sales decline by 5-10% in the fourth quarter, but is helpful to maintain the company's profits. Besides, he furthered, Acer will use most hard drives available in production of Ultrabook laptops to keep smooth delivery of such higher-margin products. At the moment, the company's Ultrabook model, Aspire S3, has proven popular in the global market, with sales to reach between 250,000 and 300,000 units at the end of this year.

It makes sense for Acer to raise its PC prices to secure profits, as the company has been fretted by business downturns so far this year, and strived hard to turn profitable. After several months of efforts on distributor inventory drawdown, the company has gradually been back on track, with its net losses already sharply improving to NT$1.092 billion in the third quarter from NT$6.79 billion seen a quarter ago.

As to business outlook in 2012, Wang predicted that Acer's shipment of PCs to post an annual growth of 10%, with tablet models to contribute 2-2.5 million units to the total.

Business Performance by Acer in Q3, 2011
SalesRevenueNT$117.8B.Up15.5% from Q2
OperatingMargin-1.1%Improvingfrom -6.9% in Q2
NetLossesNT$1.092B.Droppingfrom NT$6.79 billion in Q2
Lossesper shareNT$0.43Droppingfrom NT$2.57 in Q2
Source: Acer Inc.