Global PC sales down for 11th quarter

HP reclaims top position from Lenovo during the three months ended June 30

Global PC shipments declined for the 11th straight quarter and recorded the lowest quarter volume since 2007 during the three months ended June 30.

Total shipments stood at 61.1 million units, a 4.3 per cent decline from the second quarter of 2016.

Mikako Kitagawa, principal analyst at Gartner, said that higher PC prices are due to the impact of component shortages for DRAM, solid state drives (SSDs) and LCD panels had a pronounced negative impact on PC demand in the second quarter.

“The approach to higher component costs varied by vendor. Some decided to absorb the component price hike without raising the final price of their devices, while other vendors transferred the costs to the end-user price,” she said.

One development is that HP has reclaimed its top position from Lenovo and has achieved five consecutive quarters of yearover-year growth. Shipments grew in most regions, and it did especially well in the US market where its shipments growth far exceeded the regional average.

Lenovo slips

Lenovo’s global shipments declined 8.4 per cent in the second quarter, after two quarters of growth. Lenovo recorded year-over-year shipment declines in all key regions.

Kitagawa said the results could reflect Lenovo’s strategic shift from unit share gains to margin protection. The strategic balance between share gain and profitability is a challenge for all PC vendors.

Dell achieved five consecutive quarters of year-on-year global shipment growth, as shipments increased 1.4 per cent. Dell has put a high priority on PCs as a strategic business. Among the top three vendors, Dell is the only vendor which can supply the integrated IT needs to businesses under the Dell Technologies umbrella of companies.

However, in the business segment, Kitagawa said that vendors could not increase the price too quickly, especially in large enterprises where the price is typically locked in based on the contract, which often run through the quarter or even the year.

“In the consumer market, the price hike has a greater impact as buying habits are more sensitive to price increases. Many consumers are willing to postpone their purchases until the price pressure eases,” she said.

The Chromebook market has been growing much faster than the overall PC market. Gartner does not include Chromebook shipments within the overall PC market, but it is moderately impacting the PC market. Worldwide Chromebook shipments grew 38 per cent in 2016, while the overall PC market declined 6 per cent.

“The Chromebook is not a PC replacement as of now, but it could be potentially transformed as a PC replacement if a few conditions are met going forward,” she said.

“For example, infrastructure of general connectivity needs to improve; mobile data connectivity needs to become more affordable; and it needs to have more offline capability.”