"They spent a lot of time and resources in the netbook market, and that hasn't paid off," Daoud said, adding that eMachines did well in the entry-level PC market many years ago, but customers have moved away from those products.
The company now has to step back and see what existing customers want, Daoud said. Gateway could ultimately offer tablets, but it is hard to see smartphones in their mix, Daoud said.
Acer's moves are also part of a larger trend for PC companies to offer simpler products. There is more focus on cloud, software, graphics and other features that are critical to boost hardware sales.
While Acer's market share is dwindling, its Taiwanese counterpart Asustek has done well, with PC shipments growing 5.6 percent year-over-year in the fourth quarter. Both companies were top netbook vendors, but after a few quarters of struggling Asus is now growing, while Acer is flagging.
Acer and Asus are have different management styles, with Asus' team being more proactive and flexible, and Acer's team being slow to react, Daoud said.
Asus is also well-respected by channel partners, while Acer can't say the same, Daoud said. Asus has also been praised for innovative products like Taichi, while Acer is more cautionary. Asus has been much more keen on embracing Windows 8 and RT with products like the VivoTab RT tablet, while Acer is still waiting to see how the OS does before releasing a product.
"For Acer it's a bit of work in progress," Daoud said.
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