The worldwide PC market saw its steepest decline ever in the first quarter of 2013, the fourth quarter of year-on-year shipment declines.
Worldwide PC shipments totalled 76,3-million units in the first quarter of 2013 (1Q13), down -13,9% compared to the same quarter in 2012 and worse than the forecast decline of -7,7%, according to the International Data Corporation (IDC) Worldwide Quarterly PC Tracker.
The extent of the year-on-year contraction marked the worst quarter since IDC began tracking the PC market quarterly in 1994. The results also marked the fourth consecutive quarter of year-on-year shipment declines.
Despite some mild improvement in the economic environment and some new PC models offering Windows 8, PC shipments were down significantly across all regions compared to a year ago. Fading mini notebook shipments have taken a big chunk out of the low-end market, while tablets and smartphones continue to divert consumer spending.
PC industry efforts to offer touch capabilities and ultra-slim systems have been hampered by traditional barriers of price and component supply, as well as a weak reception for Windows 8. The PC industry is struggling to identify innovations that differentiate PCs from other products and inspire consumers to buy, and instead is meeting significant resistance to changes perceived as cumbersome or costly.
“At this point, unfortunately, it seems clear that the Windows 8 launch not only failed to provide a positive boost to the PC market, but appears to have slowed the market,” says Bob O’Donnell, IDC programme P: clients and displays.
“While some consumers appreciate the new form factors and touch capabilities of Windows 8, the radical changes to the UI, removal of the familiar Start button, and the costs associated with touch have made PCs a less attractive alternative to dedicated tablets and other competitive devices. Microsoft will have to make some very tough decisions moving forward if it wants to help reinvigorate the PC market.”
The impact of slow demand has been magnified by the restructuring and reorganising efforts impacting HP and Dell. Lenovo remains a notable exception as it continues to execute on a solid “attack” strategy.
Mid- and bottom-tier vendors are also struggling to identify growth markets within the US. Among the most vulnerable group of vendors are the whitebox system builders, which are undergoing consolidation that is affecting shipments as well as the distribution sector.
“Although the reduction in shipments was not a surprise, the magnitude of the contraction is both surprising and worrisome,” says David Daoud, IDC research director: personal computing.
“The industry is going through a critical crossroads, and strategic choices will have to be made as to how to compete with the proliferation of alternative devices and remain relevant to the consumer. Vendors will have to revisit their organisational structures and go to market strategies, as well as their supply chain, distribution, and product portfolios in the face of shrinking demand and looming consolidation.”
Preliminary figures from Gartner showed similar shipment numbers. Although it shows a slightly less precipitate drop in shipments for the first quarter – and 11,2% decline to 79,2-million units – Gartner says global PC shipments dropped below 80-million units for the first time since the second quarter of 2009.
All regions showed a decrease in shipments, with the EMEA region experiencing the steepest decline, Gartner shows.
“In the first quarter of 2013, it was the fourth consecutive quarter that showed a drop in worldwide PC shipments,” says Mikako Kitagawa, principal analyst at Gartner.
“Consumers are migrating content consumption from PCs to other connected devices, such as tablets and smartphones. Even emerging markets, where PC penetration is low, are not expected to be a strong growth area for PC vendors.
“Unlike the consumer PC segment, the professional PC market, which accounts for about half of overall PC shipments, has seen growth, driven by continuing PC refreshes. Despite the fact that some regions already passed the peak of PC refresh, overall professional PC demand continued to grow.”
HP and Lenovo were in a virtual tie for the top position in the first quarter of 2013. HP had a very challenging quarter, as it recorded its worst shipment decline since the acquisition of Compaq in 2003. HP’s consumer business negatively affected its overall shipment volume, but its professional business was also under attack by competitors.
Lenovo’s worldwide PC shipments were flat compared with a year ago. While its shipment growth rate exceeded the overall industry average, it was Lenovo’s slowest growth since the first quarter of 2009. The slowdown was attributed to a shipment decline in Asia/Pacific, where more than 50% of Lenovo’s PCs were shipped.
Dell also had a challenging quarter, registering a shipment decline in all regions except Japan. In Gartner’s preliminary view, Dell’s shipment growth in Japan was boosted by moderate demand, driven by a corporate refresh. Dell’s discussions about a possible leveraged buyout impacted shipments, as competitors aggressively attacked Dell’s position in the professional market.
EMEA suffered its third consecutive quarter of PC shipment decline in the first three months of 2013. This decline was the steepest recorded since Gartner began publishing quarterly PC market share statistics.
“The EMEA PC market continued to face challenges in the first quarter of 2013. Notably, it suffered from a fundamental shift in the role of PCs in the consumer market,” says Isabelle Durand, principal research analyst at Gartner.
“Consumers’ content consumption was – and still is – moving from PCs to other types of connected devices. Even in Central and Eastern Europe and the Middle East and Africa, where PC penetration is low, growth in PC shipments was down as first-time device buyers chose other devices.”
Demand for ultra mobiles remained slow as prices were still relatively high. New models with more aggressive prices will reach the market only in the second half of 2013, with the introduction of Intel’s “Haswell” processor.
“Touchscreen-based ultra mobiles offer PC manufacturers an opportunity to recover market share from media tablets, but Windows 8 PCs with touchscreens accounted for only a small percentage of consumer PC shipments in the first quarter of 2013,” says Durand.
“The majority of consumers remain unwilling to pay the price premium for touchscreen capabilities on PCs at this stage. But, even so, touchscreens and Windows 8 will represent key opportunities for PC manufacturers in the second half of 2013.”
HP retained the EMEA lead in the first quarter of 2013, but it faced challenges in both consumer and professional markets. Acer secured second place but recorded a steep shipment decline, with most of the drop resulting from the shift in its portfolio from netbooks to Android-based media tablets.
Lenovo was the only top-five vendor to achieve shipment growth. It claimed third place as its aggressive pricing strategy in consumer and professional markets paid off. Dell maintained its market share year-over-year, declining in line with the overall market. Asus’ PC shipments fell as it ceased netbook shipments and uptake of its ultramobiles remained slow.
Worldwide PC shipments totalled 76,3-million units in the first quarter of 2013 (1Q13), down -13,9% compared to the same quarter in 2012 and worse than the forecast decline of -7,7%, according to the International Data Corporation (IDC) Worldwide Quarterly PC Tracker.
The extent of the year-on-year contraction marked the worst quarter since IDC began tracking the PC market quarterly in 1994. The results also marked the fourth consecutive quarter of year-on-year shipment declines.
Despite some mild improvement in the economic environment and some new PC models offering Windows 8, PC shipments were down significantly across all regions compared to a year ago. Fading mini notebook shipments have taken a big chunk out of the low-end market, while tablets and smartphones continue to divert consumer spending.
PC industry efforts to offer touch capabilities and ultra-slim systems have been hampered by traditional barriers of price and component supply, as well as a weak reception for Windows 8. The PC industry is struggling to identify innovations that differentiate PCs from other products and inspire consumers to buy, and instead is meeting significant resistance to changes perceived as cumbersome or costly.
“At this point, unfortunately, it seems clear that the Windows 8 launch not only failed to provide a positive boost to the PC market, but appears to have slowed the market,” says Bob O’Donnell, IDC programme P: clients and displays.
“While some consumers appreciate the new form factors and touch capabilities of Windows 8, the radical changes to the UI, removal of the familiar Start button, and the costs associated with touch have made PCs a less attractive alternative to dedicated tablets and other competitive devices. Microsoft will have to make some very tough decisions moving forward if it wants to help reinvigorate the PC market.”
The impact of slow demand has been magnified by the restructuring and reorganising efforts impacting HP and Dell. Lenovo remains a notable exception as it continues to execute on a solid “attack” strategy.
Mid- and bottom-tier vendors are also struggling to identify growth markets within the US. Among the most vulnerable group of vendors are the whitebox system builders, which are undergoing consolidation that is affecting shipments as well as the distribution sector.
“Although the reduction in shipments was not a surprise, the magnitude of the contraction is both surprising and worrisome,” says David Daoud, IDC research director: personal computing.
“The industry is going through a critical crossroads, and strategic choices will have to be made as to how to compete with the proliferation of alternative devices and remain relevant to the consumer. Vendors will have to revisit their organisational structures and go to market strategies, as well as their supply chain, distribution, and product portfolios in the face of shrinking demand and looming consolidation.”
Preliminary figures from Gartner showed similar shipment numbers. Although it shows a slightly less precipitate drop in shipments for the first quarter – and 11,2% decline to 79,2-million units – Gartner says global PC shipments dropped below 80-million units for the first time since the second quarter of 2009.
All regions showed a decrease in shipments, with the EMEA region experiencing the steepest decline, Gartner shows.
“In the first quarter of 2013, it was the fourth consecutive quarter that showed a drop in worldwide PC shipments,” says Mikako Kitagawa, principal analyst at Gartner.
“Consumers are migrating content consumption from PCs to other connected devices, such as tablets and smartphones. Even emerging markets, where PC penetration is low, are not expected to be a strong growth area for PC vendors.
“Unlike the consumer PC segment, the professional PC market, which accounts for about half of overall PC shipments, has seen growth, driven by continuing PC refreshes. Despite the fact that some regions already passed the peak of PC refresh, overall professional PC demand continued to grow.”
HP and Lenovo were in a virtual tie for the top position in the first quarter of 2013. HP had a very challenging quarter, as it recorded its worst shipment decline since the acquisition of Compaq in 2003. HP’s consumer business negatively affected its overall shipment volume, but its professional business was also under attack by competitors.
Lenovo’s worldwide PC shipments were flat compared with a year ago. While its shipment growth rate exceeded the overall industry average, it was Lenovo’s slowest growth since the first quarter of 2009. The slowdown was attributed to a shipment decline in Asia/Pacific, where more than 50% of Lenovo’s PCs were shipped.
Dell also had a challenging quarter, registering a shipment decline in all regions except Japan. In Gartner’s preliminary view, Dell’s shipment growth in Japan was boosted by moderate demand, driven by a corporate refresh. Dell’s discussions about a possible leveraged buyout impacted shipments, as competitors aggressively attacked Dell’s position in the professional market.
EMEA suffered its third consecutive quarter of PC shipment decline in the first three months of 2013. This decline was the steepest recorded since Gartner began publishing quarterly PC market share statistics.
“The EMEA PC market continued to face challenges in the first quarter of 2013. Notably, it suffered from a fundamental shift in the role of PCs in the consumer market,” says Isabelle Durand, principal research analyst at Gartner.
“Consumers’ content consumption was – and still is – moving from PCs to other types of connected devices. Even in Central and Eastern Europe and the Middle East and Africa, where PC penetration is low, growth in PC shipments was down as first-time device buyers chose other devices.”
Demand for ultra mobiles remained slow as prices were still relatively high. New models with more aggressive prices will reach the market only in the second half of 2013, with the introduction of Intel’s “Haswell” processor.
“Touchscreen-based ultra mobiles offer PC manufacturers an opportunity to recover market share from media tablets, but Windows 8 PCs with touchscreens accounted for only a small percentage of consumer PC shipments in the first quarter of 2013,” says Durand.
“The majority of consumers remain unwilling to pay the price premium for touchscreen capabilities on PCs at this stage. But, even so, touchscreens and Windows 8 will represent key opportunities for PC manufacturers in the second half of 2013.”
HP retained the EMEA lead in the first quarter of 2013, but it faced challenges in both consumer and professional markets. Acer secured second place but recorded a steep shipment decline, with most of the drop resulting from the shift in its portfolio from netbooks to Android-based media tablets.
Lenovo was the only top-five vendor to achieve shipment growth. It claimed third place as its aggressive pricing strategy in consumer and professional markets paid off. Dell maintained its market share year-over-year, declining in line with the overall market. Asus’ PC shipments fell as it ceased netbook shipments and uptake of its ultramobiles remained slow.