Abu Dhabi, UAEWednesday 20 November 2019

Regional consumer market for PCs flatlining, says Acer chief

Electronics giant expects more robust growth in commercial arm, says EMEA president

Education industry and SMEs are Acer’s biggest clients in commercial business in EMEA region. Getty Images
Education industry and SMEs are Acer’s biggest clients in commercial business in EMEA region. Getty Images

Acer is bullish on the growth prospects for its commercial business in the Middle East and Africa region, as the electronics giant looks to expand its presence in emerging markets such as Iraq and Egypt.

However, the company's consumer business is expected to remain flat due to declining demand for personal computers, according to the Taipei-headquartered firm. Acer accounts for close to 6 per cent of global PC sales.

“The regional consumer market, involving PCs, is flat or even slightly declining in some markets since [the] past couple of years. But our commercial or B2B segment is going very strong,” Emmanuel Fromont, Acer president in Europe, Middle East and Africa, told The National.

“Iraq has shown good business corrections in the past eight months … especially in the high-end segment. Cash is available in the market and there is also a structured approach … we are also working with some of our Dubai partners to expand into more Iraqi territories," he added.

Acer expects a faster uptick in Egypt, the most populous country in the region, driven by its “young population” and comparatively stable currency.

“Egypt is slightly more stable than Iraq … it is doing very well at this moment. We have established retail partnerships and distribution channels [in Egypt] and the same growth model will be replicated in Iraq in the coming months,” added Mr Fromont.

Acer will invest “aggressively” in Egypt and new emerging markets in the region, Mr Fromont said, without divulging a dollar value.

Overall, the UAE and Saudi Arabia — the Arab world’s two largest economies — are the best-performing markets for Acer in the Middle East and Africa, while Russia is its top performer in Europe. Last year, the UAE and Egypt both saw 15 per cent annual growth in sales, whereas Saudi Arabia grew by almost 10 per cent, the company said.

In the commercial segment, the education industry and small- and medium-sized enterprises are Acer’s biggest clients in the region. The firm draws more than $2.8 billion (Dh10.3bn) in revenue from Europe, the Middle East and Africa per year.

Nearly 35 million fewer PC devices — including desktops, laptops and tablets — will be shipped globally in 2023 compared to almost 407 million in 2018, according to research firm Statista. That compares to more than 1 billion smartphones shipped last year.

However, Acer sees huge growth in the region's gaming industry. Its overall market share in the consumer business is close to 15 per cent in EMEA, but in gaming alone it is almost 20 per cent.

“We have a dual-brand strategy in gaming. For example, for heavy gamers, we have a high-end range and for casual gamers, we have a more affordable range. This strategy has helped us to enhance our market share and revenues,” Mr Fromont said.

In the first half of this year, Acer saw a 46 per cent yearly increase in revenue in the Middle East across its gaming platforms and a 41 per cent growth in volume.

Acer, whose net profit fell 54 per cent year-on-year to 408.8 million New Taiwan dollars (Dh49m) in the second quarter, expects a surge in regional business once geopolitical conditions improve.

“There is a huge demand but consumers are little cautious while spending. Once there is more stability and no insurgencies … business will grow manifold,” said Mr Fromont, adding the same happened with Russia. “The Russian market went through a tough time but it is stable now and our best performing market in Europe. We see similar potential in MEA.”

Updated: October 17, 2019 06:53 PM

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