Global PC Market Declines As US Sales Lag


Global PC Market Declines As US Sales Lag

Weak US back-to-school sales pulled down PC shipments domestically and worldwide in Q3 of 2017, according to a preliminary assessment from Gartner.

"Worldwide shipments totaled 67 million units, down 3.6% from the year-earlier quarter, and according to lead PC analyst Mika Kitagawa, what really hurt the business was a 10% drop in shipments in the US market, which offset "signs of stabilization" in markets such as Europe, the Middle East, Africa, Japan and Latin America". Improvement in emerging markets as well as back-to-school promotions helped boost results.

Dell came in third in both of the reports with relatively flat PC shipments compared to the previous year during the same quarter. In the USA market, all PC makers saw a decline in shipment numbers-HP registered the lowest decline at 2.7% year-on-year to soften the blow, while Lenovo lost the most with a 25.2% decline in shipments and Asus clocked a 22% decline. Still, it acknowledged that higher component pries and inventory limited shipments in some markets.

IDC notes that competitive pressures have further cemented the dominance of the top five PC companies, which accounted for almost 75% of the total traditional PC market.

The market watcher said a scarcity of DRAM components, which has put a hole in the PC profits of major vendors including Dell EMC, became even more severe in the third quarter of 2017 when compared with the first half of the year.

Gartner's Kitagawa said shortage in dynamic random-access memory components will "continue to the end of 2018, "but it will not be reflected in the final PC prices immediately".

Apart from the United States market pulling down global numbers, the shortages of certain components such as the DRAM led to changes in component prices. This offset the stabilizing PC markets in key regions like EMEA, Japan and Latin America.

Business PC demand, led by Windows 10 upgrades, continued to drive shipments across all regions, but its refresh schedule varies by region. HP was the only top vendor to manage a notable shipment increase with growth of 6 percent on the year.

Gartner called Q3 a "virtual tie" for the top spot, with HP at 21.8 percent and Lenovo at 21.4 percent. Gartner claims that HP Inc has experienced five consecutive quarters of PC growth, while Lenovo is stuck in a "downward trend" of falling shipments for eight of the past 10 quarters.

It is no secret that the PC market is struggling. It was the fourth consecutive quarter of declining PC shipments.

"The gains in emerging regins and potential for more commerical replacements represent some upside potential, although we continue to expect incremental declines for total shipments for the next five years", he says. Gartner just released its numbers for world PC shipments in Q3 and it's not good news for the company.