Acer sees more losses as revamp charges hurt Q2

Taiwanese PC maker Acer Inc reported a worse-than-expected quarterly loss, the first in company history, as it took charges to reorganize in a troubled first half, and said it would be impossible to break even for the full year.
Acer has been a dominant force in the PC business, particularly in the low-cost notebook segment, but has failed to counter the runaway success of tablets such as Apple's hot-selling iPad that have cut into PC sales and hurt profits.
The company has been refocusing on mobile devices to drive growth after a first half that saw the acrimonious departure of its chief executive following a row over the company's strategy and a series of cuts to its shipment forecasts.
Shares of Acer, the world's No.2 PC vendor, closed down 2.92 percent on Wednesday ahead of the earnings announcement.
They have fallen 65 percent this year in a broader market down 16.4 percent. Rival Asustek has gained 6.8 percent.
Chairman J.T. Wang told an investor conference that the second-quarter was a "correction period" and its loss was worse than expected because the company cleared up excessive inventory and made severance payments for senior management resignations.
Among those who resigned was Gianfranco Lanci, the former CEO who left abruptly in April amid a row over strategy and after a sharp cut in Acer's revenue outlook that triggered an 18 percent fall in its shares in four days.
Wang did not say how much Lanci received.
The chairman said while he expects the "fever" for tablet PCs receding and notebooks regaining consumer interest, Acer will still see a loss in the third quarter, though it would be better than the second quarter.
"Today I have to say, trying to break even this year becomes impossible," Wang said, citing a worsening macro environment in Europe and the need for "more time and effort" for the restructuring.
In July, Wang had indicated that the company would report a loss in the second quarter before returning to profit in the third and posting a small full-year profit.
Acer said in June it would take a $150 million charge to write off inventory and doubtful payments in Europe and will cut 300 jobs there.
Macquarie analyst Andrew Chang said in a report that recent checks indicate Acer has no new competitive products to launch in the third quarter to lift momentum and margins.
Macquarie expects flattish revenue growth in the third quarter from the previous quarter and a 29 percent drop from a year ago.
Acer posted a net loss of T$6.79 billion ($234.3 million) in April-June, much wider than the consensus forecast of a T$3.3 billion loss from six analysts polled by Reuters.
The unaudited net loss figure compared with a net profit of T$1.19 billion in the first quarter and earnings of T$$2.65 billion in the same period a year ago.