Acer to cut 300 jobs in Europe

The Acer Iconia ... the company has cut its target for tablet shipments

Acer, the Taiwanese company that is the second-biggest PC maker in the world, will cut 300 jobs in Europe and has slashed its full-year shipment target for tablets by almost 60% to around 3m units. The company also said it expects lower notebook shipments this year as it struggles to clear excess inventory.

The job cuts in Europe will come in "the next few months" and follows huge losses in the region, including a $150m writeoff for excess inventory and disputed payments in the Europe, Middle East and Africa region.

The company said earlier this week that it has around 3m laptops that will be sold at large retailers. At the start of June the company said in a statement that it had "discovered abnormalities in terms of channel inventory stored in freight forwarders' warehouses, and in the accounts receivables from channels in Spain".

The company is in the midst of upheaval after the abrupt departure in March of its chief executive Gianfranco Lanci, who clashed with founder Stan Shih over the company's direction. Shih favoured a tablet- and smartphone-oriented strategy, seeing them as offering higher profit margins than PCs and especially the imploding netbook market on which Acer rose to prominence from 2008 onwards.

The company has missed its last three quarterly revenue and profit forecasts, but said it expected overall shipments to improve later this year. "The third quarter will be considerably more stable. It will be similar to the second quarter or better," chairman JT Wang told a shareholder meeting on Wednesday. "The fourth quarter will be even better."

Wang told reporters after the meeting that the new target for tablet shipments this year was 2.5m to 3m units – dramatically lower than the 5m to 7m units target set at the beginning of the year. Acer now expects to sell 800,000 tablets in each of the second and third quarters.

Wang said he expected total shipments in the second quarter to fall less than 10% from the previous quarter, better than had been feared. Last month, the company posted a 29.2% drop in total sales.

In April, the PC maker cut its forecast for shipments in the second quarter to a 10% decline from January-March, citing its recent reorganisation, inventory adjustment and a seasonal slowdown in the PC industry. That would take it down to around 9.8m machines shipped in total, and could mean that it will lose its second place in the PC sales rankings to Texas-based Dell.

Shares in Acer have plunged 30% since March 25, when the company first cut its first-quarter PC revenue outlook and followed by the sudden management changes.