Acer CEO Lanci quits after boardroom bust up

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Acer CEO Lanci quits after boardroom bust up

Microscope contributor

Acer CEO and President Gianfranco Lanci has fallen on his sword, officially after a boardroom disagreement over future direction, although the recent string of disappointing results in the PC market cannot have helped.

He joined Acer as the managing director for Italy in 1995 after leaving Texas Instruments, was made President of EMEA in 2000 and took the same role at a global level in 2005 before adding CEO to his title in 2008.

Acer chairman JT Wang will assume Lanci's responsibilities on an interim basis as the company confirmed the reasons for the top level departure.

"On the company's future development, Lanci held different views from a majority of the board members, and [we] could not reach a consensus following several months of dialogue," stated Acer.

"They placed different levels of importance on scale, growth, customer value creation, brand position enhancement, and on resource allocation and methods of implementation," it added.

Acer has the lowest operating expense in the PC industry base and used strong relationships with the Original Design Manufacturers (ODMs) to offer price points that lured consumers in and underpinned its rise to the top.

However, consumer confidence and growing interest in tablet PCs resulted in an abrupt end to booming mainstream notebook sales, and highlighted Acer's reliance on the segment, despite its efforts to diversify through acquisition.

In calendar Q4 numbers, Acer reported group revenues of $4.7bn (£2.92bn), down 11% year-on-year and operating income of $139m (£86.3m), down 11.7%. More recently, it warned PC revenues in Q1 will decline around 10% due to the impact of tablets.

Ranjit Atwal, research director at Gartner, told MicroScope that Acer had made a good fist of becoming a major player in the PC space but the consumer boom was over and its efforts to build sales in the professional market were more muted.

"Fundamentally, Acer's business model is predicated on maintaining volumes in consumer mobile PCs which allows them to maintain and increase margins. But consumers are now generally backing off buying traditional PCs," he said.

According to Gartner Q3 numbers, Acer's worldwide PC shipments fell 1.7% in a market that grew 7.6%, while in Q4 the vendor's sales declined 1.8% against average market growth of 3.1%.

Atwal said that Acer's efforts in the professional mid-market, led by the Gateway brand in Europe, had not compensated for the drop in consumer demand.

"Given that the professional market is moving away from a box mentality - most vendors are trying to provide solutions - the whole sale is becoming more complicated in terms of how you get to the business customer," he said.

Acer said today that it plans to get more heavily involved in the "new mobile device market" - tablets - but with HP, Dell, Samsung and of course Apple, vying for share, competition will be fierce.

In an other high level move, Acer Deputy President of EMEA, Walter Deppeler was today promoted to EMEA President wth immediate effect.

Related Topics: Desktop PCs, VIEW ALL TOPICS

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