Acer chief executive J.T. Wang resigns on Q3 record loss

Acer chief executive J.T. Wang resigns on Q3 record loss

Summary: The troubled computer maker's chief executive will step down after the company took a financial bullet to the chest in its fiscal third quarter earnings.

Acer president Jim Wong (left) will replace chief executive J.T. Wang (center). (Image: CNET)

Acer's chief executive and chairman J.T. Wang has resigned from the computer maker, following abysmal sales and a massive operating loss in its fiscal third quarter earnings.

The Taipei, Taiwan-based computer giant, whose position currently stands at number four in the global PC market, reported an operating loss of $43 million, on revenue of $3.13 billion, up 3.1 percent on the previous quarter but close to 12 percent down year-over-year.

Wang said in prepared comments, following the poor quarterly results, it was time to "hand over the responsibility to a new leadership team to path the way for a new era."

Acer president Jim Wong will take up the chief executive's position beginning January 1, 2014.

The company will undergo "drastic" restructuring in order to stave off further financial downturn, including laying off 7 percent of its workforce, and scrapping a number of products currently in development. In total, this will cost about $150 million, which the company will swallow in its fiscal fourth-quarter earnings. The hope is to save $100 million annually in operating expenses from 2014.

In a statement to Reuters, Acer pinned the fiscal third quarter operating loss as being "mainly due to the gross margin impact of gearing up for the Windows 8.1 sell-in and the related management of inventory."

Wang in August 2012 stirred controversy in an interview with London's Financial Times, calling on Microsoft to "think twice" about launching its own Windows-powered Surface tablet, amid ongoing rivalry in the tablet space.

We've put in questions to Acer, and will update this post once we have more.

Topic: PCs

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  • Acer and Android

    Silly Acer, we all know what they should have done, build a $499 device and sell it for $199 running stock Android. Build $999 Tablet PC's with Haswell and 128Gb SSD Drives and sell it for $299 with Windows 8.1

    Because that would have obviously saved them.
    Dreyer Smit
    • Yeah, all those chromebooks and android tablets...

      ...obviously made them a healthy profit.
    • Silly Acer

      I only have one word to say about Acer, CHEAP! I would not take their devices even if they were giving them away. The one time I had to try to fix one of their laptops they would not even talk to me until I paid them 35 dollars. What a piece of crap business strategy, they sell you cheap crap and make it up on the backend with crappy customer service and then don't even offer to fix or replace the crap you bought, even if it's under warranty. I put them even lower on my buy list than HP, and that's a pretty low mark to be able to get under, lol. I despise HP almost as much as Acer. Good-luck to whoever has the misfortune to become next CEO, and good-luck to anyone who bought any of their products. You'll be lucky if your device even last until the warranty expires.
      • Totally with you on HP

        I had an HP laptop which was ONE DAY out of warranty and the keyboard melted into the motherboard due to a defective, and dangerous, Lithium Battery.

        HP would not even talk to me about a repair or replacement and when I checked their battery recall program my battery was the ONLY one in a series which was not recalled.

        I would NEVER buy another HP again.
    • You could tell the guy didn't know how to run

      the show when he got his panties all twisted about the surface instead of having a couple surface crushing devices hitting the market before surface did. MS bent over backwards to ensure that all OEMs had every opportunity to out do the surface in every respect. But instead this guy just started crying. This move is two years late.
      Johnny Vegas
  • Chromebooks and android tablets diverted Acer attention

    They wasted money and resources on Android tablets/Phones and Chrome books which were low margin and didn't sell at all.

    They should have focused on one platform with better design.

    Next is HP.
  • If any company truely doesn't understand consumers it is Acer

    Acer makes low quality products with poor design decision and expects to sell them at competitive prices against their competition. It is no wonder why they are doing do poorly.

    That applies to their Windows, ChromeOS and Android devices.
    • Actually... Acer tablet has served me well the last couple of years. I'd buy another without hesitation.
      John L. Ries
      • My $200 Acer Chromebook 710

        This thing is about 6 mos old and I've just liked it better and better.

        I knew Acer had a rep for suspect quality, but it was a small investment. Didn't want a Samsung - I wanted a Chromebook with an Intel processor, so I could run regular Linux software if I rooted into CrUbuntu. But I've had no quality issues at all with this box, it's really pretty nice.

        Admittedly, I haven't had to deal with customer service. But I'm happy so far. I like the looks of the 710's recent upgrade, too.

        I don't know the profit margin on this thing - it must be small, as $200 is a pretty small pie to cut a slice from - that would be easier with a $1000 Ultrabook. But I for one hope that Acer continues to produce this quality of Chromebook - I'd buy another in a heartbeat.
    • RE: ACER Laptops and their reliability!

      A year ago I gave my granddaughter my 7 year old Acer laptop which I upgraded to 3 GB of ram and a 250 Gb 7200 rpm H.D. when she went to college and she is still using it. All told the laptop has been wonderful for me and for her. my 1½ year old Acer Aspire 5733Z has been upgraded to 8Gb of Ram and a 250 Gb Samsung 830 SSD. and it is a real speed demon. I have had not 1 bit of trouble from either one of my Acer Laptops since they were purchased. Way to GO, Acer!!! :-)
  • A Wang for a Wong.

    ~C|Net commentators

    (Acer needs to die.)
  • My Acer Iconia A500 was decent tablet, however, it only got the ICS ...

    update from Honeycomb (ICS update was very late in coming), but not update for JellyBean. If I had gotten the Jellybean update, I would have considered myself lucky and kept on with Acer. Now, I will likely just purchase the Google Galaxy device when I am ready to purchase again as I expect updates for longer than what Acer is prepared to support (I would have even paid a small fee to get the update). Sometimes with a company it is the little things that make the difference.
  • There is no space for so many PC vendors

    Sales are not growing anymore, profit margins are low as never before, windows 8 and touch laptops were irrelevant so far. Alternative non traditional PCs (android or chromebooks) are a tinny spot on the screen.

    Lenovo strength and the decline of traditional PCs are making damage.

    I suppose Asus will soon be also in trouble.
    • Asus =! Acer

      If anything, Toshiba will be the next to go.
  • Not every thing is bad..

    I bought two Acer laptops last year. One for my daughter to replace her MacBook that was dying and was useless in college and another for my granddaughter. So far they have worked fine with no problem

    The main problem is Wang was not the right person for the job. Since the beginning he knew the specs for Windows 8. Instead of building to a higher quality, he spend time and effort to stop Microsoft building Surface. The reason for Surface was made by Microsoft was the low quality that Acer and HP were building. Microsoft show them what to expect and how to build the same high quality product. Instead they cry foul. No touch screen from the beginning, a lower resolution for their laptops, and many other small changes to save a buck or two. While Lenovo, Apple and even Asus were shooting for a better PC/Laptop/Tablet, Asus was aiming to a lower price.

    They were shooting at every market without aiming and hitting none.