Worldwide PC Shipments Below Expectations

Gartner analysts said global shipments were impacted by slower sales in the U.S. market. PC shipments in the U.S. grew 5 percent in the third quarter, however analysts had expected shipments to increase more than 8 percent in the quarter. Other regions performed in line with expectations.

“U.S. home notebook shipments were strong during the quarter, but desktop demand was much weaker, which brought down back to school shipments overall,” said Charles Smulders, vice president of Gartner’s Computing Platforms Worldwide group.

On a vendor basis, Dell extended it unit share lead both worldwide and in the U.S. in the third quarter of 2004 (see Tables 1 and 2). Dell performed particularly well in Europe, as its shipments increased 36.7 percent compared to the same period last year.

Table 1Preliminary Worldwide PC Vendor Unit Shipment Estimates for 3Q04(Thousands of Units)                            3Q04     3Q04      3Q03     3Q03    3Q03-Company                 Shipments  Market  Shipments  Market     3Q04                                     Share              Share   Growth                                        (%)                (%)     (%)---------------------------------------------------------------------Dell                       7,862     16.8     6,505     15.2    20.9Hewlett-Packard            7,045     15.0     6,435     15.0     9.5IBM                        2,614      5.6     2,242      5.2    16.6Fujitsu/Fujitsu Siemens    1,700      3.6     1,552      3.6     9.6Toshiba                    1,579      3.4     1,342      3.1    17.6Others                    26,119     55.7    24,690     57.7     5.8Total                     46,919    100.0    42,767    100.0     9.7Note: Data includes desk-based PCs, mobile PCs and X86-32 servers.Gateway and eMachines are reported as one company, as are Fujitsu andFujitsu Siemens.Source: Gartner Dataquest (October 2004)

Hewlett-Packard’s growth was in line with the industry average, allowing it to maintain its market share compared to a year ago. “Regionally HP is coming under pressure in the U.S. retail market as rivals compete more aggressively for shelf space,” Mr. Smulders said.

In the United States, PC shipments totaled 16.2 million units in the third quarter of 2004, a 5 percent increase from the third quarter of 2003 (see Table 2). Gartner analysts said notebook sales were strong, but desktop demand was much weaker.

Table 2Preliminary U.S. PC Vendor Unit Shipment Estimates for 3Q04(Thousands of Units)Company                     3Q04     3Q04      3Q03    3Q03     3Q03-                         Shipments  Market  Shipments Market      3Q04                                     Share             Share    Growth                                        (%)               (%)      (%) ---------------------------------------------------------------------Dell                       4,919     30.4     4,297    27.9     14.5Hewlett-Packard            3,090     19.1     3,042    19.7      1.6Gateway                      832      5.1       941     6.1    -11.6IBM                          797      4.9       706     4.6     13.0Toshiba                      561      3.5       468     3.0     19.9Others                     6,006     37.1     5,976    38.7      0.5Total                     16,205    100.0    15,430   100.0      5.0Note: Data includes desk-based PCs, mobile PCs and X86-32 servers.Gateway and eMachines are reported as one company.Source: Gartner Dataquest (October 2004)

On a regional basis, the Europe, Middle East and Africa (EMEA) region performed in line with expectations, as shipments were up 12.6 percent compared to a year ago. Mobile PC growth continues to drive the market, but the strongest growth in demand remains at the entry level price points, which reinforces pressure on margins.

In the Asia/Pacific region, India and Australia showed some of the strongest shipment increases with growth rates of 30 and 19 percent, respectively. Shipments in China grew 11 percent, however a major concern going forward is the impact of government control measures to prevent overheating of the Chinese economy.

PC shipments in Latin America grew 29 percent in the third quarter. The strong shipment increase is attributed to PC replacement demand, lower interest rates, flexible PC vendor purchasing programs, broadband deployment and better system specification/price point positioning.

These results are preliminary. Final statistics will be available soon to clients of Gartner’s PC Quarterly Statistics Worldwide by Region program.

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