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PC Market Continues Downward Trend in Q2

The worldwide PC market took a dive in the second quarter, declining by about 11 percent, year over year.

Analyst and consulting firms Gartner Inc. and IDC both issued preliminary Q2 results for the PC market on Wednesday. Their findings track for the most part. Gartner indicated that 76 million PCs were shipped worldwide in the second quarter, representing a 10.9 percent decrease year over year. IDC reported 75.6 million PCs shipped worldwide in the second quarter, down 11.4 percent year over year.

The PC market was defined as desktops, laptops and mininotebooks, but not tablets. The decline in PC shipments for the quarter represented an ongoing trend. The Q2 PC market decline was the fifth straight quarterly decline for that segment and represents "the longest duration of decline in the PC market's history," according to an announcement by Gartner.

Tablets are displacing low-end PCs in developed markets, according to Gartner. However, touch-based notebooks aren't quite broadly distributed yet. Gartner noted in its announcement that "touch-based notebooks still account for less than 10 percent of the total consumer notebook shipments in the last quarter."

IDC suggested that the market is still coming to grips with Windows 8 touch devices. Additionally, high-priced ultrabooks are facing competition from lower priced "tablets and other devices," IDC indicated in its announcement.

As for the top PC vendors, Lenovo barely edged out HP in terms of the number of PCs shipped worldwide during the second quarter. Those two PC vendors have been close contenders in the global market, running neck and neck over the last year (see IDC chart). However all of the PC vendors showed negative growth, year over year, in terms of the number of PCs shipped worldwide during the second quarter.

The PC vendor competition shifts a bit when the U.S. market is examined. Despite the overall bad quarter for PCs worldwide, both Gartner and IDC saw some signs that U.S. business new PC uptake is being influenced by a need to replace Windows XP-based machines. Organizations face losing security patch support from Microsoft in April for Windows XP, which may add pressure for a PC refresh. As a sign that businesses may be reacting to that impending deadline, both analyst firms pointed to better U.S. results for HP, Dell and Lenovo, which are traditional PC sellers to U.S. business markets.

HP and Dell remained as close contenders in the U.S. PC market during the second quarter. Those two vendors together constituted nearly 50 percent of the U.S. PC market in Q2, according to IDC. Dell actually experienced a positive 5.8 percent growth in the second quarter due to its U.S. PC sales, per IDC.

"The U.S. market is beginning to reflect some of the Windows XP to Windows 7 transition we've been expecting in the commercial PC space, as evidenced by the strong growth in the enterprise-focused Dell PC business," said Bob O'Donnell, program vice president for clients and displays, in a released statement.

The worst-hit vendor in terms of worldwide PC sales for the second quarter was Acer, with shipments down 35 percent (Gartner) or 33 percent (IDC), year over year. Acer is shifting from netbooks to Android tablets, according to Gartner. It's also being hit by slow demand for its higher priced ultrabooks, according to IDC.  

In its Q1 PC report, IDC laid heavy blame for the PC slump at Microsoft's door, suggesting that Windows 8 had "slowed the market." Gartner took a different position in announcing its Q2 report on PC shipments.

"While Windows 8 has been blamed by some as the reason for the PC market's decline, we believe this is unfounded as it does not explain the sustained decline in PC shipments, nor does it explain Apple's market performance," said Mikako Kitagawa, a principal analyst at Gartner.

Both Gartner and IDC listed Apple as the No. 3 PC vendor in the U.S. market.

About the Author

Kurt Mackie is online news editor for the 1105 Enterprise Computing Group.

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