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Weak Demand for Tablets Pushes Q2 PC Shipments Down 10.9%

Oct 04, 2013 | By Steve Chuang

Thanks mostly to declining demand for tablets, global PC shipments in the second quarter of this year dropped by 10.9% year-on-year (YoY) to around 76 million units, according to preliminary estimates by Gartner Inc., a British market research firm.

In its recent report, Garnter pointed out that global market demand for conventional PCs has suffered a widespread downturn this year. In the Asia Pacific shipments have shrunk for five quarters in a row, while in the EMEA (Europe, the Middle East and Africa) bloc the downturn has lasted for two consecutive quarters.

Mikako Kitagawa, a senior Gartner analyst, noted that the current shrinkage of the global PC market is closely related to the decline of the installed base, as tablets with comparatively user-friendly unit prices are quickly replacing low-end conventional PCs in the consumer market in developed countries. Consumers in emerging markets are choosing tablets instead of PCs as their first computing devices, causing a collapse in sales of netbook PCs, which were recently considered an economical alternative to laptops.

World's Top Five Brands Stumble
According to the Gartner report, the world's top five PC brands all suffered declining shipments in the second quarter because of the sagging global PC market and the unstable global economy.

Lenovo again unseated HP as world's biggest PC brand in the second quarter, with a 16.7% share of the quarter, but saw its shipment slip 0.6% YoY to 12.755 million units. HP's share of the global market during the period dropped to 16.3%.

Gartner pointed out that the main reason why China-based Lenovo could rise to the top of the rankings was the rapid growth of its shipments to America and the EMEA bloc; this offset a significant decline in the Asia Pacific, where market demand in China remained lukewarm.

Despite lagging Lenovo by a very thin margin in terms of global market share, HP still dominated such key regional markets as the U.S., EMEA, and Latin America. Notably, the U.S. brand has significantly improved its once-lackluster sales in the Asia-Pacific market, thanks mainly to the payoff from its years-long promotional efforts there.

Preliminary Estimates of PC Shipments (excluding tablets) by the World's Top 5 Brands in Q2, 2013

Brand

Shipment Volume in Q2, 2013

Market Share in Q2, 2013

Shipment Volume in Q2, 2012

Market Share in Q2, 2012

Year-on-Year Growth

Lenovo

12,677,265 units

16.7%

12,755,068 units

14.9%

-0.6%

HP

12,402,887 units

16.3%

13,028,822 units

15.3%

-4.8%

Dell

8,984,634 units

11.8%

9,349,171 units

11.0%

-3.9%

Acer

6,305,000 units

8.3%

9,743,663 units

11.4%

-35.3%

Asus

4,590,071 units

6.0%

5,772,043 units

6.8%

-20.5%

Others

31,041,130 units

40.8%

34,675,824 units

40.6%

-10.5%

Total

76,000,986 units

100.0%

85,324,591 units

100.0%

-10.9%

Source: Gartner Inc.

Due mainly to banner growth in the U.S. and Japan, Dell shipped some 8.98 million units of PCs (excluding tablets) to command an 11.8% share of the market and take third place in the second quarter, reducing the rate of overall decline it has suffered during the past few quarters. However, Gartner added, its sales in the Asia Pacific and the EMEA bloc remained slack.

Acer and Asus, both from Taiwan, came in fourth and fifth, respectively, with a number of shipments and global market share of 6.3 million units and 8.3% for Acer (down from 9.7 million and 11.4%), and 4.6 million units and 6.0% for Asus (compared with 5.8 million units and 6.8%). Gartner explained that the two Taiwanese brands both suffered a serious decline in shipments because of their withdrawal from the netbook PC segment.

Senior analyst Kitagawa noted that Gartner disagrees with the idea that Windows 8 should be considered among the reasons behind the current downturn in the global PC market because, from the real-world viewpoint, it does not serve as a very convincing factor in explaining either why global PC shipments keep dropping, or why Apple's PC sales weakened in the second quarter.

About 15 million conventional PCs were shipped in the U.S. during the second quarter, down 1.4% YoY, the slightest drop in seven quarters and actually representing a growth of 8.5% from the previous quarter, due partly to a robustly-growing enterprise segment that was shared by HP, Dell, and Lenovo, and partly to Microsoft's tapering of Windows XP tech support which triggered local consumer demand for new PC replacements installed with newer editions of Windows, according to Gartner. Meanwhile, Apple's PC shipments dropped 4.3%, caused largely by encroachment by the iPad, but retained its place as the third-largest brand in the market.

Preliminary Estimates of PC Shipments (excluding tablets) in the U.S. by the Top 5 Brands in Q2, 2013

Brand

Shipment Volume in Q2, 2013

Market Share in Q2, 2013

Shipment Volume in Q2, 2012

Market Share in Q2, 2012

Year-on-Year Growth

HP

3,957,761 units

26.4%

3,976,041 units

26.2%

-0.5%

Dell

3,681,725 units

24.6%

3,458,736 units

22.8%

6.4%

Apple

1,740,500 units

11.6%

1,818,959 units

12.0%

-4.3%

Lenovo

1,515,562 units

10.1%

1,266,109 units

8.3%

19.7%

Toshiba

848,984 units

5.7%

1,006,900 units

6.6%

-15.7%

Others

3,230,717 units

21.6%

3,659,220 units

24.1%

-11.7%

Total

14,975,249 units

100.0%

15,185,965 units

100.0%

-1.4%

Source: Gartner Inc.

Gartner noted that PC shipments in the EMEA block, weakened mainly by the economic uncertainty that has dampened consumer spending in the EU, shrank 16.8% YoY in the second quarter, to 21.3 million units. The downturn in shipments was especially severe in Eastern Europe, where consumers were awaiting the launch of newer Android-powered tablets and were hesitant to spend on ordinary PCs. Another factor was the traditional low season for the enterprise segment there.

In the Asia-Pacific, PC shipments were down 11.5% from a year earlier to just over 26.8 million units. Market demand was generally slack in most countries there; India, where PC demand was fueled by government purchases, was an exception.


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