Acer CEO: We're Going to Stop Selling Cheap, Unprofitable Crap
Acer CEO J.T. Wang has settled on a turnaround strategy for the company, one that will return it to profitability after two consecutive quarters of net losses. Acer is going to pin its hopes on the ultrabook.
Context & Ripple Effects
Acer had already framed a MacBook Air rival as part of its return-to-profit plan in July 2011, after its earlier ultra-thin effort had struggled amid competition from HP and Dell. Two consecutive loss-making quarters turn that product direction into a broader portfolio reset.
The strategy also sits beside Acer's planned $799–$899 ultrabook pricing, making the company’s attempt to move upmarket a test of whether thinner notebooks can support better economics rather than simply higher volumes.
First-order effects
- Acer’s product planning shifts away from low-priced, loss-making PCs and toward ultrabooks as the centerpiece of J.T. Wang’s profitability plan.
- Acer’s two consecutive quarterly losses make margin discipline, rather than unit volume alone, the immediate measure of the turnaround.
Second-order effects
- Acer must reconcile its MacBook Air-rival strategy with planned ultrabook price cuts, narrowing the room to use premium design as a margin fix.
- HP and Dell face an Acer that is no longer positioning ultra-thin notebooks only as a volume play, increasing pressure to distinguish their own thin-and-light offerings on more than price.
Third-order effects
- If other PC makers make the same calculation, low-end notebook volume becomes less attractive as a standalone strategy and product portfolios tilt toward clearer premium and budget tiers.
- The episode points to a PC market in which manufacturers seek profitability through differentiated form factors and tighter SKU economics, rather than treating every shipment as equally valuable.
The trend: PC manufacturers are moving from volume-led notebook sales toward tiered portfolios that use premium thin-and-light designs to defend margins.