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Wednesday, October 09, 2013
PC shipments Keep Falling

Worldwide shipments of personal computers fell in the third quarter of the year, the sixth straight quarter of decline as tablets and smartphones cut into demand, according to market research firms IDC and Gartner Inc.

IDC said the market fell nearly 8 percent, to 81.6 million units, while Gartner put the decline at almost 9 percent, to 80.3 million.

IDC expects that the PC market will hit bottom sometime next year, with a recovery starting in 2015 as companies finally replace aging PCs.

IDC said worldwide PC shipments totaled 81.6 million units in the third quarter of 2013 (3Q13). In year-on-year terms, the market contracted -7.6%, ahead of a projected decline of -9.5% for the quarter. While shipments remained weak during the early part of the quarter, the market was somewhat buoyed by business purchases, as well as channel intake of Windows 8.1-based systems during September.

The top three vendors (Lenovo, HP, and Dell), which all have an important presence in the enterprise and public sectors, each saw modest positive year-on-year growth during the quarter. Conversely, consumer sentiment remained lukewarm at best, as evidenced by the continued struggles of Acer and ASUS.

"The third quarter was pretty close to forecast, which unfortunately doesn?t reflect much improvement in the PC market, or potential for near-term growth," said Loren Loverde, Vice President Worldwide PC Trackers. "Whether constrained by a weak economy or being selective in their tech investments, buyers continue to evaluate options and delay PC replacements. Despite being a little ahead of forecast, and the work that's being done on new designs and integration of features like touch, the third quarter results suggest that there's still a high probability that we will see another decline in worldwide shipments in 2014."

"The United States outperformed many other regions as growth stabilized just under 0%. Continuing upgrades from Windows XP boosted shipments, particularly in the commercial desktop segment, while retail acceptance of new and emerging product categories, such as Chromebooks and Ultraslims, helped the portables segment," said Rajani Singh, Senior Research Analyst, Personal Computers. "Nevertheless, the broad picture of the U.S. market has not changed much, with hopes for a small increase in the fourth quarter followed by a challenging 2014."

According to IDC:

- Lenovo maintained the top PC vendor title, and continued to expand its channel reach as well as experiment with new form factors. The vendor also posted a strong gain in the U.S. market, growing more than 2% compared to a year ago.

- HP finished the quarter in the number 2 position, with growth improving from recent quarters. Shipment trends also improved in the U.S. and EMEA, but HP continued to face struggles in Latin America, IDC found.

- Dell saw its first positive year-on-year growth since the fourth quarter of 2011, thanks largely to maintaining growth in the Americas market.

- Acer Group continued to be affected by declines in shipments across all regions due to continued weakness in consumer PC spending. The firm nevertheless has remained aggressive in trying new form factors and hybrid devices.

- ASUS shared a similar predicament with Acer where despite a focus on new designs, its lack of corporate customer base has also limited its growth.

According to the Gartner, Q3 marks the "sixth consecutive quarter of declining worldwide shipments.

Most of the other market share allotments on both the global and U.S. playing fields were on par with what the IDC found. However, IDC claims that Apple was the only one of the top five vendors to lose market share during the third quarter on an annual basis, down approximately 11.2 percent. On the other hand, Gartner implies the decrease was minimal, only dropping by 2.3 percent annually.

Here is a summary of Gartner's findings:

- Lenovo, HP, and Dell managed to grow their respective shares, but Acer, Asus and the rest of the market saw losses

- Lenovo and HP were neck-and-neck. Lenovo has managed to increase its lead, although it is still only a 0.5 percentage point gap.

- Dell's PC shipments exceeded growth rate averages across all regions

- Acer's shipments declined a 22.6 percent compared with a year ago

- Asus saw PC shipments decline 22.5 percent, despite the fact it has shifted its focus from PCs to tablets.

Gartner believes low inventory from the first half of 2013 as well as the introduction of new models with Intel's Haswell, including new form factors, brought the sell-in shipment up compared with a year ago.

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