PC Sales Rise in Harsh Economic Headwinds

Brian.oco 0 Tallied Votes 308 Views Share

Amidst the carnage that is Wall Street this year (the Dow Jones Industrial Average is down 20% since last October, classifying the stock market as being in official “bear” territory), there are glimmers of good news, and a good portion of it is coming from the tech sector.

The latest manifestation of that is with the latest numbers from the personal computer market, which is performing better than expected. I would say “much better than expected”. According to the technology research firm iSuppli, global PC shipments are up 12% for the first quarter of 2008 – perfectly matching the 12% average growth rate for PC’s during the first quarter of the last five calendar years.

That’s an interesting number. When the economy was going good, like in 2005, PC sales for Q1 clocked in at 12%. When the economy is going bad, as in 2008, PC sales for Q1 still clock in at 12% - no slowdown at all. That’s got to be an encouraging sign for PC makers and tech companies, overall.

iSuppli says that credit for the continued strong numbers in the PC market goes to mobile units (I’ll have more on that trend in a minute). Overall, PC shipments grew by 69.9 million units from the last quarter of 2007, and that’s a slight improvement in growth from the same period a year before (62.4 million units). Topping iSuppli’s list of PC sellers are Hewlett-Packard, Dell, and Acer.

According to iSuppli analyst Matthew Wilkins, (who warns that lousy consumer sentiment should push PC sales down in Q2), HP boosted shipments in the quarter by 23% over a year ago to reach 13.2 million units, and had market share of 18.9%. Dell spiked shipments by 20% to nearly 9 million units, which drove a half of a percent rise in market share to 15.4%. Acer, which recently bough out Gateway and Packard Bell) rounded out the top three rankings with a 10.5% boost in shipments to 6.8 million units, or 9.7% of the market.

But it’s the mobile/laptop market that PC analysts are talking about. The data research firms, Gartner and IDC both issued new forecasts in the past two weeks showing that the PC market, despite iSuppli’s warning from Wilkins, that quarterly PC sales should continue to grow in 2008, in spite of a souring economy. IDC sees PC growth rising to 15% going forward, while Gartner raised its quarterly forecast by 2.5%.

Says Gartner analyst, George Shiffler, “The G.D.P. decline in the U.S. was less than feared, the emerging markets continue to go gangbusters, and the mobile market is very hot.”
IDC says that laptop sales are growing much faster than desktops. In the United States, IDC predicts that portable sales will increase by 23.6 percent this year while desktop sales will drop 2.8 percent. Worldwide, the firm says that portables will grow by 33.9 percent this year, but desktop sales, including servers, will increase only 5.1 percent. Helping laptop sales is the fact that the cost of memory is declining, making it easier for PC companies to offer lower prices to cash-strapped customers.

So there you have it - a ray of light in a cloudy stock market climate. Hopefully, consumers keep can keep the PC party going.