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To: tejek who wrote (114750)	10/23/2000 8:14:58 AM
From: Road Walker	Read Replies (1) \| Respond to of 186894

Acer slashes profit expectations on sliding PC demand By Bloomberg News October 23, 2000, 4:25 a.m. PT TAIPEI--Acer, Taiwan's largest personal computer maker, cut its profit forecasts by a third for this year on worse-than-expected fourth-quarter PC demand, sending its share price plunging. A preliminary estimate showed profit at $250 million (NT$8 billion) for the year, down 33 percent from the earlier estimate of $374 million. The new sales forecast of about $3.28 billion is down 19 percent on the original expectation. Final numbers will be available at the end of the month. Acer's warning is the latest sign that global demand for PCs may be slowing and another blow to the Taiwanese company, already troubled by canceled IBM orders and a shortage of Intel chips this year. "The golden era for Acer is already in the past, because the personal computer industry is a matured market with small growth potential" in the coming years, said Lu Yi-fen, manager of First Global Investment Trust's $18 million Hitech Fund. While Acer originally predicted that global demand for personal computers would grow 15 percent in the fourth quarter this year, the company now expects growth to be below 10 percent. IBM in January stopped sales of Acer's Aptiva consumer desktop PCs through retailers. "We see their computer orders have been canceled or transferred to other PC or notebook makers," said Steve Chou, who helps manage $400 million in Taiwan stocks at Truswell Securities Investment Trust here and sold all his Acer shares about three months ago. "We don't see much growth in this group." Acer made the announcement in a statement Sunday, saying that one reason for the cut in profit expectations is the decline in the Taiwan stock market, which prevented the company from disposing of some equity investments. Acer has fallen 64 percent this year, compared with a 33 percent decline in the island's key Taiwan Stock Exchange index. "Winter seems to have come early this year for computer makers," said Simon Lin, president and CEO of Acer. Copyright 2000, Bloomberg L.P. All Rights Reserved.