HEWLETT-PACKARD CO.
The numbers The world's biggest computer maker posted strong third-quarter earnings yesterday, topping some analyst expectations. The company's sales numbers are still down compared to the same period last year, but mark a turnaround from the earlier part of this year.
The strategy HP's rise to the top of the personal computer market was in fact driven only in part by computer sales. Of the major computer manufacturers, HP is one of the most diversified, making much of its money from printers, software and other services. The company has also expanded geographically, posting some of its best numbers in Asian markets.
The challenges Even though HP topped many analyst estimates, its stock price dropped slightly in after-hours trading. The company raised its quarterly profit in large part through cost-cutting measures, but both its computer and printer businesses saw lower sales, leading to worries that the good news may be only temporary.
ACER INC.
The numbers The Taiwanese firm continues its upward rise through the ranks of the world's top computer manufacturers. The company posted a 14-per-cent rise in profits when it announced its third-quarter numbers late last month. Perhaps more importantly for the public perception, Acer appears to have overtaken Dell as the world's second-biggest computer maker after HP.
The strategy Price, price, price. Acer has focused intensely on the low-cost segment of the computer market, making a name for itself in the world of netbooks - cheap, no frills laptops with less functionality but a substantially cheaper price tag. During a global recession, the strategy appears to be working.
The challenges Of the three biggest computer makers, Acer is perhaps the least well-known in the North American market. While the company has been successful at targeting price-conscious consumers, it is now taking aim at other market segments, and it is still unclear how successful it will be there.
DELL INC.
The numbers Dell's share price took a beating after the company posted third-quarter numbers last week that showed profit dropped 54 per cent from a year ago, well below analyst expectations. Almost every part of Dell's business saw weaker numbers during the quarter.
The strategy Consumers may be buying more machines, but that doesn't necessarily help Dell. It generates about 80 per cent of its business from large companies and governments, rather than everyday consumers. Demand in the enterprise sectors has been much slower to recover from the recession, hurting Dell's bottom line.
The challenges Dell executives say they expect better sales numbers in the fourth quarter, but did not give estimates. The company is trying to expand its business from core computer sales to areas such as IT services -- a move the company made when it acquired Perot Systems for about $3.9-billion. But there are already several large players in the areas Dell wish to expand into, and it is unclear how long it will take before its core enterprise computer business fully rebounds.
