Acer 3Q26 Preview: Street's Full Year Puts Fourth-Quarter Sales 23% Below the Third
Acer's July, August and September filings put 3Q26 revenue up 25% YoY and 8% QoQ, with September's NT$34.7bn the highest for that month in 14 years. The release therefore turns on margins, inventory and profit.
The street's FY26E revenue of NT$320.5bn leaves NT$70.9bn for the fourth quarter, 5% below 4Q25. That fits management's August call for a fall of more than 20% in second-half PC volumes, which has yet to show in Acer's revenue.
Inventory reached NT$99.0bn at the end of June, 2.4 times a year earlier, much of it memory bought as prices rose. Each percentage point of gross margin on 3Q26 revenue is worth about NT$0.92bn of pre-tax profit, half of 2Q26 operating profit.
Of NT$3.89bn pre-tax profit in 2Q26, NT$2.12bn came from outside operations, including gains on energy-storage project sales. The street's FY26E net profit implies NT$2.57bn for 2H26E, below the NT$2.87bn earned in 1H26.
Company snapshot
Acer (2353 TT) is a Taiwan-based PC brand that sells notebooks, desktops, Chromebooks, gaming PCs and monitors, and has most of its hardware built by contract manufacturers. Its margins are thin: gross margin has stayed between 10% and 12% for the last eight quarters (Exhibit 4) and operating margin between 1% and 2.2%. Subsidiaries and new businesses, including industrial computers, IT services, cloud services and energy storage, now make up more than a third of revenue, and stakes in them add investment income and disposal gains to profit.
Expectations snapshot
Acer is expected to report 3Q26 results in early November; it reported 2Q26 results in early August. It files revenue every month, so the quarter's sales are already known, and it gives no numeric guidance. The table sets the reported figures against the street's numbers.
| Metric | 3Q26 | 4Q26E | FY26E | FY27E |
|---|---|---|---|---|
| Revenue | Reported monthly: NT$91.8bn (+25.1% YoY, +7.6% QoQ) | Street implied NT$70.9bn (-23% QoQ, -5% YoY); not guided | Street NT$320.5bn (+16%); Zero One NT$323.9bn | Street NT$324.9bn (+1%); Zero One NT$329.4bn |
| Gross margin | Not guided; double digits expected (2Q26: 11.4%) | Not guided | Not guided (1H26: 11.3%) | Not guided |
| Net profit | Not guided (2Q26: NT$2.17bn) | Street implied 2H26E NT$2.57bn | Street NT$5.44bn (1H26: NT$2.87bn) | Street NT$5.61bn (+3%) |
| EPS | Not guided (2Q26: NT$0.72) | Street implied 2H26E NT$0.85 | Street NT$1.80 (1H26: NT$0.95) | Street NT$1.88 |
| Reported to date | July-September revenue filed | n/a | 9M26 revenue NT$249.5bn (+24.0% YoY) | n/a |
Recent developments
- Second-quarter profit doubled on higher prices and non-operating gains. Revenue was NT$85.30bn, up 28.2% YoY, gross margin 11.4% and net profit NT$2.17bn, up 100.2% YoY and the highest quarter since the pandemic, or NT$0.72 per share (company release, August). Management said the quarter included one-off gains from selling energy-storage projects, booked as non-operating income, and that 3Q26 would also carry energy-storage profit (Commercial Times, 19 August).
- Management expects second-half PC volumes to fall by more than 20%. Chairman and CEO Jason Chen said at the 18 August results briefing that full-year PC volumes would fall by at least 10%, after industry selling prices rose 20-30% in the first half and pulled buying forward. IDC forecasts a fall of more than 11% for the year. Acer aims to keep its own PC prices stable (Commercial Times, 19 August).
- Industrial computers carry a gross margin above 40%. Chen said subsidiaries and new businesses had passed a third of revenue, that Acer holds about six industrial-computer investees and will keep acquiring, and that group gross margin should stay in double digits (Commercial Times, 19 August).
- Chen said in September that memory prices have probably peaked. He said PC memory is no longer short, that Chinese suppliers are quoting aggressively, and that memory and SSD costs should fall next year, with PC prices following several months later (United Daily News, 19 September).
- Inventory more than doubled in a year. It reached NT$99.0bn at the end of June, up from NT$41.9bn a year earlier (Exhibit 5). In June, Chen put component inventory above NT$80bn, a record and higher than during the pandemic, mostly memory (Mirror Media, 17 June).
- The shares are where they were after the 2Q26 results. At NT$30.25 on 2 November they match the 7 August close, after reaching NT$33.15 on 27 October.
Third-quarter revenue already reported, up 25% YoY
Third-quarter revenue is settled. The three monthly filings add up to NT$91.8bn, the third straight quarter of YoY growth above 18%, and August and September each rose from the month before.
| Month | Revenue (NT$m) | MoM | YoY |
|---|---|---|---|
| July 2026 | 26,904 | -3.3% | +21.9% |
| August 2026 | 30,180 | +12.2% | +38.4% |
| September 2026 | 34,737 | +15.1% | +17.6% |
| 3Q26 total | 91,822 | +7.6% QoQ | +25.1% |
- Revenue for the first nine months of 2026 reached NT$249.5bn, up 24.0% YoY.
- The street's FY26E revenue of NT$320.5bn leaves NT$70.9bn for 4Q26E, an average of NT$23.6bn a month, 32% below September.
- Matching 4Q25 revenue of NT$74.4bn would give FY26 revenue of NT$323.9bn, 1% above the street.
October revenue, due around 10 November, is the first test of how far fourth-quarter sales fall from the third.
No numeric guidance; management expects second-half PC volumes to fall by more than 20%
Acer gives no revenue or margin guidance. Its direction comes from management commentary: in August it expected second-half PC volumes to fall by more than 20% and group gross margin to stay in double digits, with industrial computers and other subsidiaries carrying growth (Commercial Times, 19 August).
Revenue has so far outrun that volume call because prices rose. Gross margin has moved in a narrow band, from 10.1% in 2Q25 to 11.6% in 4Q25 and 11.4% in 2Q26 (Exhibit 4), while inventory rose from NT$41.9bn to NT$99.0bn over the same year (Exhibit 5).
The street expects FY26E revenue of NT$320.5bn, up 16%, and net profit of NT$5.44bn, or NT$1.80 per share, against NT$3.78bn in FY25 (FMP consensus; the FY26E figures rest on a single estimate). For FY27E, on four estimates, it expects revenue up 1% to NT$324.9bn and net profit of NT$5.61bn (Exhibit 6).
Our model carries FY26E revenue of NT$323.9bn, 1% above the street, which leaves 4Q26E revenue level with 4Q25. The gap to the street is the size of the fourth-quarter fall; both numbers put 4Q26E well below 3Q26.
We expect gross margin near 11% on already-reported revenue
- Revenue of about NT$91.8bn, already reported. The consolidated figure in the release should sit close to the sum of the three monthly filings, as it did in 2Q26.
- Gross margin near the 11.4% of 2Q26, with risk in both directions. Higher selling prices and a larger share of industrial computers support it. Against that, much of the NT$99.0bn inventory was bought while memory prices were rising, and Chen said in September that those prices have probably peaked. Each percentage point of gross margin on NT$91.8bn of revenue is worth about NT$0.92bn of pre-tax profit, or about NT$0.22 per share after tax at the 2Q26 tax rate.
- Operating profit up on higher sales. 2Q26 operating profit was NT$1.77bn, a 2.1% margin, on NT$85.3bn of revenue. On NT$91.8bn of revenue, an unchanged margin would give about NT$1.9bn.
- Another non-operating contribution. Management said 3Q26 would also include energy-storage profit. Its size decides how far net profit moves from the NT$2.17bn of 2Q26.
What investors should watch: gross margin and inventory, the fourth-quarter fall, operating profit
Three issues in the release bear on the 2026 and 2027 numbers; for each we name the specific thing to check.
- Does gross margin hold above 11%, and does inventory start to fall? Check 3Q26 gross margin against 11.4%, any inventory write-down, and inventory against NT$99.0bn. A write-down of 1% of the June inventory would cost about NT$1.0bn, more than Acer's whole operating profit in 1Q26.
- How large a fourth-quarter fall does management describe? The street's FY26E needs only NT$70.9bn of 4Q26E revenue, 23% below 3Q26. Check management's comments on fourth-quarter PC demand and pricing, and October revenue against NT$21.2bn in October 2025.
- How much of profit comes from operations? Check operating profit against NT$1.77bn in 2Q26, the size of the energy-storage gains, and the share of revenue from industrial computers and other subsidiaries, which carry the higher margins.
Valuation and peer comparables: 9.0x forward EV/EBITDA, 1.2x book
At NT$30.25 Acer trades at 9.0x forward EV/EBITDA, against a peer median of 8.1x, and at 1.2x book value, the lowest in the group against a median of 2.8x (Exhibit 7). On the street's FY26E earnings of NT$1.80 per share the shares trade at 16.9x.
With operating margins near 2%, Acer's P/E moves sharply with small changes in margin or in non-operating gains, so the table shows it as n.m. EV/EBITDA, close to the peer median, is the steadier measure. The low price to book reflects a balance sheet that includes stakes in listed and unlisted subsidiaries.
If gross margin holds above 11% while inventory is worked down, the street's FY27E net profit of NT$5.61bn looks reachable. An inventory write-down would pull FY26 profit back toward the NT$3.78bn of FY25.
| Company | Mkt cap (US$bn) | P/E (TTM) | P/E (Fwd) | P/B | EV/Sales (TTM) | EV/Sales (Fwd) | EV/EBITDA (TTM) | EV/EBITDA (Fwd) |
|---|---|---|---|---|---|---|---|---|
| US-listed PC brands | ||||||||
| Dell Technologies | 269.7 | 24.3x | 16.4x | n.m. | 1.9x | 1.5x | 15.9x | 10.9x |
| HP Inc | 26.0 | n.m. | n.m. | n.m. | 0.5x | 0.5x | 7.7x | 6.9x |
| Taiwan-listed PC brands | ||||||||
| ASUSTeK Computer | 20.8 | 13.4x | 11.9x | 2.3x | 0.8x | 0.7x | 14.8x | 8.4x |
| Gigabyte Technology | 6.9 | n.m. | n.m. | 3.4x | 0.7x | 0.5x | 12.2x | 9.4x |
| Micro-Star International (MSI) | 4.0 | n.m. | 11.4x | 2.3x | 0.5x | 0.6x | 10.1x | 7.8x |
| Hong Kong-listed | ||||||||
| Lenovo Group | 33.4 | n.m. | n.m. | 4.4x | 0.4x | 0.3x | 6.0x | 4.3x |
| Peer median (all peers) | 18.8x | 11.9x | 2.8x | 0.6x | 0.6x | 11.1x | 8.1x | |
| Acer | 2.8 | n.m. | n.m. | 1.2x | 0.4x | 0.4x | 12.3x | 9.0x |
Source: FMP market data and consensus estimates, Zero One Investment Research. Prices at the latest quotes on 2 Nov 2026. Forward multiples use each company's next unreported fiscal year per FMP consensus. P/E shown as n.m. where net margin is below 5%, where near-break-even earnings make it unstable; other multiples above 100x or below zero shown as n.m. Medians over the peers shown, Acer excluded.