While concern over the global recession and the fear of rising unemployment continues to weigh on commercial spending and consumer confidence, PC demand has nevertheless remained somewhat resilient compared to the last downturn. Falling prices, fueled in part by Mini Notebook PCs and added efforts in channel development, have helped to minimize the market contraction. The United States fared well, with shipments falling only 3% as HP, Acer, and Toshiba leveraged Portable sales into solid growth. Europe, Middle East and Africa (EMEA) and Asia/Pacific excluding Japan (ApeJ) also came in slightly better than expected.
“Tight credit and economic concerns have certainly taken a toll on PC shipments in the last couple quarters, but the move to portables, fueled by Mini Notebooks and falling prices, has mitigated the impact,” said Loren Loverde, program director for IDC’s Worldwide Quarterly PC Tracker. ”Following a drawdown in inventory throughout the supply chain, we expect more stable production over the next couple quarters, with growth returning around the end of the year.”
“The U.S. PC market proved to be surprisingly resilient this quarter as notebooks were still seen as important purchases by many U.S. consumers,” said Bob O’Donnell, vice president, Clients and Displays research at IDC. “HP's dethroning of Dell as the U.S. market share leader and extending its worldwide market share lead is a testament to the company's solid record of business execution over the last several quarters and indicates that Dell still faces some challenges in its efforts to reignite its business.”
Regional Outlook
- United States – The U.S. PC market fared better than expected, and breaking with tradition, even outperformed the global market and many emerging regions. The preliminary figures provide a glimmer of hope that consumer spending may not be as weak as predicted and opportunities for growth remain in key segments. Major vendors experienced some unexpected growth in the retail channel in the beginning of the year, as consumer spending on notebooks continued. Record low prices and the steady penetration of Mini Notebooks (including Netbooks) helped drive PC shipments. HP and Acer led the charge, both with remarkable double-digit growth. Desktop shipments suffered greatly, essentially affected by stalled demand in the enterprise market, a trend likely to continue as the economy remains in recession.
- Europe, Middle East, and Africa (EMEA) – EMEA recorded its first yearly decline since the 2001 recession. In line with forecasts, the CEE region remained the most affected while growth in Western Europe declined moderately considering the overall environment. Desktop sales continued to decline across the region. While portable PCs continue to drive demand, sales remained flat, aided by sustained demand for mini notebooks, particularly in Western Europe.
- Japan – Despite some signs of resilience at the end of last year, Japan ultimately succumbed to economic pressure like other regions. Mini Notebook PC adoption continued to grow, but commercial and Desktop volume continued to fall while consumers cut back on purchases of more expensive systems faster than expected.
- Asia/Pacific excluding Japan (APeJ) – The region met expectations as most major countries came close to forecasts, balancing another sizable decline in India. Desktop shipments declined faster than expected, especially as commercial activity remain weak. Consumer portables were the main driver for the region, particularly in Greater China.
Vendor Highlights
- HP grew 2.9% overall and claimed the number 1 spot in the U.S. Sales were boosted by solid demand in Consumer notebooks, especially in United States and Japan, which saw double-digit growth in part from strong showing in the retail channel. Internationally, HP shipments were down just 1% from a year ago while the total market was down near 8%.
- Dell had a tough quarter across the board, though it fared better in some emerging regions. A weak Commercial market resulted in faster declines in Desktops while its Portable sales struggled to address competition and the shift to low priced consumer systems. However, its recent alliance with Ingram Micro and Tech Data could pay dividends in short order.
- Acer had a solid quarter with shipments increasing nearly 7% from a year ago. The company continues to expand rapidly in the Americas. Growth remained positive, but slower than recent periods in EMEA and Asia/Pacific. Acer is pushing quickly into large-screen Mini Notebooks, building on its success in this category.
- Lenovo saw total growth in-line with the market as gains in Asia/Pacific offset losses elsewhere. Lenovo shipments in APeJ were roughly flat from a year ago while the rest of the market saw declines. Although this reflects the company’s stated focus on Asia/Pacific, it risks letting other regions deteriorate. The company struggled through a management change in Japan, producing Lenovo’s slowest growth, but Americas shipments were also down near 20% from a year ago.
- Toshiba finished 1Q09 with 11.6% growth. Its continuing focus on Portable PCs contributed to share gains in every region. The company saw strong growth in the United States and APeJ, while growth in EMEA and Japan slowed.
