Acer passes Lenovo in Q1, next up: Dell

Becomes the world's third largest PC vendor

Acer achieved its top goal for 2007 early in the year, passing Lenovo Group as the world's third largest PC vendor in the first quarter. For the rest of the year it plans to extend its lead over Lenovo, executives said, putting it in position to challenge Dell.

Moving ahead of Lenovo is more than a sales victory. It's also a vindication for Acer that its strategy of increasing sales through working with distributors and other partners in key markets is superior to Lenovo's acquisition strategy. Lenovo has not managed to grow faster than its rivals since it bought IBM's PC division.

"We believe we can maintain the number-three position this year," Acer's president, Gianfranco Lanci, said at the company's first quarter investors' conference in Taipei. He expects to extend the lead over Lenovo as the year progresses.

Acer's share of the global PC market rose to 6.8 per cent in the first quarter, up a blistering 46.1 per cent over the same three months last year, according to figures from market research company Gartner.

Lenovo's share was 6.3 per cent, putting it in fourth place. Dell didn't turn in a stellar performance, either. Its market share dropped to 13.9 per cent from 16.4 per cent in the same quarter a year ago as unit sales declined 7.8 per cent, cementing it in second place overall.

Acer executives also reiterated a prediction to increase PC shipments by 30 per cent to 40 per cent year-on-year in 2007. If the company can keep up its rapid growth, and Dell fails to rekindle its sales, Acer will move into its rearview mirror before long.

"We don't have a target date to challenge number two, it's still far off," Acer's chairman, J.T. Wang, said. But he also said Acer would continue to put a major focus on expanding in the US market, home to Dell and Acer's other main competitor, HP.

US users would continue to see good prices from Acer, he said, and Acer would continue to keep prices low in order to take market share in the US.

Acer's revenue rose 20 per cent year-over-year in the first quarter to $NT99.5 billion ($US3.01 billion as of March 31, the end of the three month period being reported). Net profit increased to NT$5.66 billion from NT$4.02 billion a year earlier.

Executives credited strong sales of its laptop PCs in the US, Europe and Asia for most of the gains, and said they were trying to increase sales of desktop PCs. Notebooks accounted for 62 per cent of Acer's revenue in the first quarter, while desktops made up only 17 per cent.

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Dan Nystedt

IDG News Service
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