AST Boosts Sagging Retail Picture With Wal-Mart Sales Deal : Computers: Irvine company’s PCs will soon be available at about half of the stores in the nation’s largest consumer outlet.

Shoring up its drooping presence in the computer retail market, AST Research Inc. said its PCs will soon be available on the shelves of Wal-Mart, the nation’s largest retailer.

As part of a recently signed agreement, AST’s low-cost Advantage computers will be sold at 1,250 Wal-Mart stores, about half the outlets in the Arkansas-based company’s chain, AST officials said.

“There were a lot of rumors this fall that we were going to get out of the consumer channels” to focus on corporate accounts, said Bret Berg, director of marketing at Irvine-based AST. “Wal-Mart represents our first success in signing a new customer. This is the first of what I believe will be a series of announcements from AST on new consumer retailers.”

Industry experts said the deal strengthens the flagging retail presence of AST, which was bumped in August from its prominent place on the shelves of Radio Shack stores. That chain signed a deal with IBM instead.

Wal-Mart already carries computers made by Packard-Bell, Compaq, IBM and Apple. But analysts pointed out that despite Wal-Mart’s dominance as a discount retailer, the company has not yet proved to be a computer sales powerhouse.

The deal with Wal-Mart “is probably good because it lets AST move some merchandise and gets their presence back out into the retail channels,” said Stephen Baker, an analyst at International Data Corp. in Framingham, Mass. “In the long run though, no one thinks the Wal-Mart stores are going to be a huge outlet for PCs.”

Wal-Mart had computer hardware sales of about $200 million last year, Baker said, about one-tenth the sales volume of the CompUSA chain of computer superstores.

Disappointed by low sales, other computer manufacturers including Dell and Acer have stopped selling their computers through Wal-Mart stores in recent years, Baker said.

AST has shipped thousands of PCs to Wal-Mart, and the machines are on the shelves in many of the chain’s stores, Berg said. The computers, equipped with Pentium processors, fax/modems and popular multimedia equipment, will sell for $1,499.

Berg acknowledged that Wal-Mart is not an outlet frequented by computer shoppers who want the latest equipment. But Wal-Mart’s strategy of building stores in rural markets “hits the heartland, the middle-America demographic that we were not hitting as hard as we should have.”

Currently, the bulk of AST’s sales to consumers are through Computer City, Incredible Universe, Sam’s Wholesale Clubs and Price-Costco, Berg said.

To take advantage of its new retail foothold at Wal-Mart, AST will have to do a better job rolling out new products on schedule and reacting to competitors’ price cuts, analysts said. Product delays and management mistakes have plagued AST in recent years, resulting in a loss of about $96 million in the latest quarter, and a loss of nearly $100 million last year.

“The analysts are dead-on accurate,” Berg said. “That’s our challenge--shipping product on time and shipping product at the right price. Either we get that execution and discipline down or we’re not a long-term player.”

The company’s co-founder and chairman, Safi U. Qureshey, had been criticized for failing to make those changes. He stepped down last month as chief executive to make way for Ian Diery, a former executive at Apple Computer Inc.