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Health of the PC market
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Tuesday, January 21, 2003
U.S. customers returned to the PC market in Q4 pushing worldwide shipments up by 4 percent to 38.4 million units in the quarter, according to market researcher IDC Corp. However, that's still below IDC's predicted 4.4 percent growth.
In the U.S., consumer demand boosted growth to 6.6 percent, despite a challenging year-on-year comparison. U.S. sequential growth of 5.7 percent was low compared to the historical average of 6.7 percent, but still beat forecasts of 3.5 percent.
"Despite the overhanging cloud of recession-related consumer confidence issues, people came out and bought PCs anyway this holiday," said Roger Kay, IDC's director of client computing, in a statement. "This was helped by vendors that bent over backwards to offer great deals in retail and through direct distribution, actions that boosted shipment levels. Although this activity hurt the top and bottom lines in some cases, well-packaged bundles attracted a fair amount of up-sell, which should offset the negative impact of price cutting to some degree."
The U.S. consumer demand helped move Hewlett-Packard Co. back to No. 1 in worldwide shipments, after trading places with Dell Computer Corp. over the previous three quarters. The combined HP, Compaq company challenged Dell in Q2, but Dell came out on top in Q3 through aggressive pricing and consistent execution of its direct business model, IDC said.
"The fourth quarter results show that HP is executing well after the merger and can leverage its consumer and international business to boost volumes when these markets are sound," said Loren Loverde, director of IDC's Worldwide Quarterly PC Tracker, in a statement. "The health of these segments going forward, as well as HP's ability to recapture some of the volume lost before the merger, will play a significant roll in the company's ability to defend this title. We expect the race for leadership in total PC shipments will be neck and neck for the next few quarters."
While Dell took the No. 2 slot in Q4 worldwide, it held its No. 1 position in the U.S. market. The No. 3 worldwide player, IBM Corp., didn't benefit from Q4 consumer seasonality in the U.S. but outdid market growth year-on-year. IBM was also ahead of the market growth worldwide reflecting gains in the commercial market, IDC said.
On an annual basis worldwide shipments were up 1.5 percent, following a decline of 4.2 percent in 2001, IDC reported. Dell led the market with shipments of 20.7 million and growth of 20 percent, while HP (excluding Compaq before the Q2 merger) shipped 18.4 million. Analyzed together, the market researcher reported that HP and Compaq shipments were down 9.2 percent from 2001 but would have surpassed Dell shipments with 21.8 million units.
Europe saw weak consumer demand and little improvement in the commercial market segment limited growth in Western Europe as portable systems were still hot, although commercial purchases lagged slightly. Japan's market didn't do much better, with demand remaining low as leaders followed market trends. However, Asia's PC market remained strong for another quarter with solid double-digit growth. Demand in China was strong, although the Korean market was relatively weak, IDC said, adding that regional growth changed little from the prior quarter.
By: DocMemory
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