U.S. Markets open in 6 hrs 9 mins

Upbeat PC Shipment Numbers for 1Q

Zacks Equity Research

Market research firms IDC and Gartner recently came out with encouraging personal computer (PC) shipment numbers for the first quarter of 2012. As per the recent disclosure, worldwide personal computer shipments increased more than IDC’s expectation during the first quarter.

However, the research firm believes that although the PC shipments surged during the quarter, the challenges facing the PC industry remain intact.

In a recent statement, Gartner Inc. noted that around 89.0 million PCs were shipped during the first quarter of the year, an increase of 1.9% from the prior-year period and was also higher than the research firm's expectation of 1.2%.

IDC witnessed that PC shipments were up 2.3% for the quarter, although the firm expected a 0.9% decline.  However, this estimate beat does not indicate the revival of the PC industry.

On the contrary, industry experts are of the opinion that PCs have taken a backseat amid the growing popularity of tablet devices like iPad in the U.S. and other developed nations. Gartner also found that the demand for PCs was trending down in important markets, such as China and India.

This is a sort of a warning bell for the PC industry, which shows that PC makers cannot rely heavily on growth in these regions. The analysts are also of the opinion that PC vendors typically witness a dip in sales during the first quarter, which comes just after the holiday season. On the other hand, Gartner's results reveal that shipments were in fact impacted by growing consumer demand  for smaller, sleeker devices.

As per Gartner, technology major Hewlett-Packard (HPQ) was the top PC vendor, with 15.31 million units shipped during the quarter. Shipments improved 3.5% year over year to 17.2%. Lenovo was placed in the second position with 13.1% market share, up 28.0% year over year.

Third-placed Dell Inc’s (DELL) market share dropped slightly from 11.4% to 11.0%, on the back of a 1.6% year-over-year decline in volume. Acer, which grabbed the fourth spot, witnessed a 9.2% drop in volume, that pulled down the market share to 10.9% from 12.2% a year-ago. This apart, Asustek Computer saw a 21% rise in volume. Also, the company’s market share rose to 6.0% from 5.1% a year earlier.

Apple Inc’s (AAPL) market share climbed from 9.8% to 10.6%, on a 3.8% increase in volume.

In terms of geographical shipments, PC shipments declined 3.5% in the U.S., which is better than the 6.1% decline anticipated. Moreover, shipments to Asia spiked 2.0%, weighed down by weak demand in India and China.

On the other hand, shipments to Latin American declined 3.2%. This apart, shipments to Japan rose 11.5% and those to the larger Europe and Middle East region increased 6.7%. So, mixed numbers from different geographical regions reveal the fact that the replacement of PCs with other mobile devices has yet to catch up across geographies.

Although the industry witnessed a shortage of hard drives, it was not a hindrance for the larger players.

Read the Full Research Report on AAPL

Read the Full Research Report on HPQ

Read the Full Research Report on DELL

Zacks Investment Research

More From Zacks.com