Global PC market shows growth in Q2; Lenovo wins globally, Apple wins in U.S.

Market research firms Gartner and IDC have both released preliminary data for global PC sales in the second quarter of 2011, and the reports paint a much improved picture compared to the first quarter of the year. Lenovo was the biggest winner globally in terms of growth according to Gartner, having shipped 10.23 million PCs for a 12% share of the market. The China-based vendor’s PC market share grew a whopping 22.5% compared to the same quarter a year prior, and Lenovo now finds itself in the No. 3 spot globally. HP was still the top vendor with shipments totaling 14.89 million units, and Dell remained in the No. 2 spot with 10.62 million units shipped. Acer and ASUS rounded out the top-5 with 9.30 million units and 4.47 million units, respectively. Though Apple’s operating system share continued to climb last month, the firm still doesn’t sell enough units to bump it from the “Others” category on Gartner’s global table. In the U.S., however, Apple showed the biggest market share gains last quarter with 8.5% growth over the same quarter last year. While IDC’s numbers vary compared to Gartner’s, the end results are the same. IDC has Lenovo’s global growth pegged at 22.9% over the second quarter last year, and it shows that Apple grew even faster than Gartner estimates with 14.7% growth in the U.S. compared to the same quarter a year prior. The two firms agree that Acer was the biggest loser globally. Acer’s share of the worldwide PC market was down 20.4% from the second quarter of 2010 according to Gartner, and down a less alarming 10.1% according to IDC. Taiwan-based Acer was the biggest loser in the U.S. as well, as its share was down 22.6% year-over-year according to Gartner and 25.4% according to IDC. Full press releases from both firms follow below.

Gartner Says Worldwide PC Shipments Increased 2.3 Percent in Second Quarter of 2011

STAMFORD, Conn., July 13, 2011—

Worldwide PC shipments surpassed 85.2 million units in the second quarter of 2011, a 2.3 percent increase from the same period last year, according to preliminary results by Gartner, Inc. These results are below Gartner’s earlier projection for 6.7 percent growth.

“After strong growth in shipments of consumer PCs for four years, driven by strong demand for mini-notebooks and low-priced consumer notebooks, the market is shifting to modest, but steady growth, said Mikako Kitagawa, principal analyst at Gartner. “The slow overall growth indicates that the PC market is still in a period of adjustment, which began in the second half of 2010.”

“Vendor’s performances have become variable as they have had to deal with significant inventory buildup, changes to their product mix, and the fact that growth has been coming mostly from emerging markets. Vendors are having to shift resources away from mature consumer markets. They are also invested in developing media tablets, many of which launched in the first half of 2011.”

HP continued to be the worldwide leader, as it accounted for 17.5 percent of worldwide PC shipments in the second quarter of 2011 (see Table 1). The company performed better than average in most regions, but it was pulled down by its performance in Asia/Pacific. Globally, HP achieved solid growth in the professional PC market, but it continued to face challenges in the consumer segment.

Table1
Preliminary Worldwide PC Vendor Unit Shipment Estimates for 2Q11 (Units)

Company 2Q11 Shipments 2Q11 Market Share (%) 2Q10 Shipments 2Q10 Market Share (%) 2Q10-2Q11 Growth (%)
HP 14,888,086 17.5 14,454,971 17.4 3.0
Dell 10,621,436 12.5 10,283,074 12.3 3.3
Lenovo 10,225,358 12.0 8,349,272 10.0 22.5
Acer 9,298,989 10.9 11,689,255 14.0 -20.4
Asus 4,467,611 5.2 4,306,241 5.2 3.7
Toshiba 4,411,400 5.2 4,497,576 5.4 -1.9
Others 31,306,987 36.7 29,732,493 35.7 5.3
Total 85,219,865 100.0 83,312,882 100.0 2.3

Note: Data includes desk-based PCs, mobile PCs, including mini-notebooks but not media tablets such as the iPad. Final estimates will be subject to change.
Source: Gartner (July 2011)

Dell moved into second place in the worldwide PC market for the first time since the fourth quarter of 2008. Dell did well in Asia/Pacific, where it has invested heavily lately. Professional PC refreshments definitely boosted Dell’s growth. Lenovo experienced the strongest growth among the top-tier vendors, as shipments increased 22.5 percent. Lenovo achieved strong growth in Asia/Pacific, the U.S. and Latin America with both desktop and mobile PCs.

Acer dropped from No. 2 to the No. 4 position in the worldwide PC market in the second quarter of 2011. It had a great deal of inventory in the distribution channel in the Europe, Middle East and Africa (EMEA) region. Acer’s problems stemmed from its low-price, high-volume business model, which is no longer effective.

In the U.S., PC shipments totaled 16.9 million units in the second quarter of 2011, a 5.6 percent decline from the second quarter of 2010. The major inhibitor was clearly a weak consumer PC market.

“Given the hype around media tablets such as the iPad, retailers were very conservative in placing orders for PCs. Instead, they wanted to secure space for media tablets. Some PC vendors had to lower their inventory through promotions, while others slimmed their product lines at retailers,” Ms. Kitagawa said.

“The professional PC sector was the bright spot in the U.S. market,” Ms. Kitagawa said. “Large enterprises were in the middle of their refreshment purchase period, which started last year. Small and midsize businesses (SMBs) were also at the peak of their refreshment periods. Due to budgetary constraints, the public sector had a slow start in the second quarter of 2011, even though the second quarter is typically a period of high PC sales.”

Based on preliminary results, Apple showed the strongest growth among the top-tier vendors in the U.S., as it climbed from fifth place to third, overtaking Acer and Toshiba (see Table 2). The preliminary findings show Apple’s performance far exceed the industry average, partly driven by an iMac refreshment that attracted both consumers and buyers in the education sector.

Table 2
Preliminary United States PC Vendor Unit Shipment Estimates for 2Q11 (Units)

Company 2Q11 Shipments 2Q11 Market Share (%) 2Q10 Shipments 2Q10 Market Share (%) 2Q11-2Q10 Growth (%)
HP 4,552,777 26.9 4,608,280 25.7 -1.2
Dell 3,821,759 22.6 4,236,303 23.6 -9.8
Apple 1,814,000 10.7 1,671,500 9.3 8.5
Toshiba 1,616,400 9.6 1,565,000 8.7 3.3
Acer 1,570,257 9.3 2,028,284 11.3 -22.6
Others 3,539,666 20.9 3,803,974 21.2 -6.9
Total 16,914,859 100.0 17,913,341 100.0 -5.6

Note: Data includes desk-based PCs, mobile PCs, including mini-notebooks but not media tablet such as the iPad. Final estimates will be subject to change.
Source: Gartner (July 2011)

PC shipments in EMEA totaled 23.1 million units in the second quarter of 2011, a 4.8 percent decline from the second quarter of 2010 (see Table 3).

Table 3

Preliminary EMEA PC Vendor Unit Shipment Estimates for 2Q11 (Units)

Company 2Q11 Shipments 2Q11 Market Share (%) 2Q10 Shipments 2Q10 Market Share (%) 2Q11-2Q10 Growth (%)
4,930,934 21.4 4,757,512 19.6 3.6
Acer 3,255,000 14.1 5,001,106 20.6 -34.9
Dell 2,416,497 10.5 2,217,815 9.2 9.0
Asus 2,005,809 8.7 2,054,264 8.5 -2.4
Lenovo 1,333,857 5.8 1,299,758 5.4 2.6
Others 9,128,114 39.6 8,901,074 36.7 2.6
Total 23,070,211 100.0 24,231,529 100.0 -4.8

Note: Data includes desk-based PCs, mobile PCs, including mini-notebooks but not media tablet such as the iPad. Final estimates will be subject to change.

Source: Gartner (July 2011)

“For the second consecutive quarter the PC market in EMEA showed decline,” said Ranjit Atwal, research director at Gartner. “The PC market in the region remained weak due to slow consumer demand and lower sell-in with PC shipments. In addition, high inventory adjustments by Acer worsened the downside view of the market.

The impact of the Acer inventory clearance saw Acer shipments decline 34.9 percent year-on-year, as some 3 million mobile PCs were cleared out of distribution. Acer’s weak performance contributed nearly 55 percent to the decline of the EMEA PC market in the second half of 2011. “If we remove Acer, the EMEA PC market would have showed a 3 percent growth year-on-year,” said Mr. Atwal. “While this may be an impractical view of the market, it is important to separate supply issues of one vendor against the general trends in the market.”

Demand in the professional PC market has picked up as organizations released budgets to migrate aging PCs to Windows 7. Dell in particular seemed to benefit from this upturn in the professional market.

Acer and Asus were the only vendors of the top five vendors ranking to show decline in shipments and market share in the second quarter of 2011. HP retained the No. 1 spot with encouraging growth in the professional PC market. Lenovo’s takeover of Medion did not have any impact on the overall results this quarter but the professional market bolstered the vendor’s growth. Overall shipments of media tablets took place late this quarter and volumes remained low, minimizing any impact of the media tablets for PC substitutions in the second quarter of 2011.

“There is no doubt that the continued weak consumer demand within Western Europe and economic issues in Southern Europe had some impact on consumer confidence across Western Europe,” said Mr. Atwal. “The feedback from retail channels remained pessimistic, especially in most of Southern Europe, with only France and Germany reporting stronger end-of-quarter shipments as channels cleaned out inventory.” Overall growth in the Central and Eastern Europe and the Middle East and Africa markets could not compensate for the weak shipments in Western Europe.

In Asia/Pacific, PC shipments reached 30.5 million units in the second quarter of 2011, a 9.6 percent increase from the same period last year. The PC market continued to grow moderately, cushioned from the volatility in other regions. However, individual market performances were mixed, with indications of channel inventory issues and delivery postponements in some Southeast Asian countries. India showed weaker-than-expected consumer demand, while China’s PC market grew 10.9 percent year over year. China’s growth was attributed to the release of pent-up demand for consumer PCs.

The PC market in Latin America grew 15 percent in the second quarter of 2011, as shipments totaled 9.2 million units. Concerns over Brazil’s overheating economy are abating with news that the country’s gross domestic product (GDP) for the first quarter of 2011 grew by 1.3 percent. Inflation in May was down from the previous seven months. Able Brazilian PC vendors are trying to expand in response to increased foreign competition. Local vendors are looking to make up for lost growth in their home country by entering foreign markets where multinational PC vendors are unlikely to venture.

PC shipments in Japan grew 5.5 percent in the second quarter of 2011, with shipments reaching 3.9 million units. The biggest contributor to growth in the professional market in the second quarter of 2011 was a supply-side factor. Many of the shipments in the second quarter had been postponed from March due to the earthquake and tsunami. In the consumer segment, demand for PCs to replace desktop PCs was the main driver of growth. All-in-one desktops and notebooks with large screens sold well at retail stores.

These results are preliminary. Final statistics will be available soon to clients of Gartner’s PC Quarterly Statistics Worldwide by Region program. This program offers a comprehensive and timely picture of the worldwide PC market, allowing product planning, distribution, marketing and sales organizations to keep abreast of key issues and their future implications around the globe. Additional research can be found on the Computing Hardware section on Gartner’s website at http://www.gartner.com/it/products/research/asset_129157_2395.jsp.

PC Market Returns to Positive Growth in Line with Expectations, Though Gains Remain Small, According to IDC

FRAMINGHAM, Mass., July 13, 2011 – Worldwide PC shipments increased 2.6% in the second quarter of 2011 (2Q11), according to the International Data Corporation (IDC) Worldwide Quarterly PC Tracker. The results are just short of IDC’s May projections for 2.9% growth and represent a combination of a hangover from the more than 20% growth in the first half of 2010 as well as competition from smartphones, other consumer products and pressure from lackluster economic conditions. As in 1Q11, the United States and Western Europe were among the weaker regions, reflecting constrained demand in more mature markets, while emerging regions – particularly Latin America and Asia/Pacific (excluding Japan) – fared better.

“These preliminary results continue to reflect pressure from competing consumer and business products as well as cautious spending,” said Jay Chou, senior research analyst with IDC’s Worldwide Quarterly PC Tracker. “Nevertheless, product refreshes and promotions in the second half of the year as well as easier year-ago data should boost growth in the second half of the year.”

“The U.S. PC market continued to contract in 2Q11, largely as a result of three factors. The first is an ongoing contraction in the Mini Notebook (Netbook) market and related inventories. The second is the impact of 2Q10’s difficult-to-sustain 12% growth. And third, demand has softened as corporate buyers continue to focus on increasing share of their IT budget in new IT solutions such as cloud and virtualization, and consumer interest shifts to media tablets,” says Rajani Singh, research analyst, United States Quarterly PC Tracker. “Given the weakness of 2H10, we expect a better market environment in 2H11 with mid-single digit growth rates in the third quarter’s back to school and fourth quarter’s holiday season.”

Regional Outlook

  • United States – With a decline of 4.2% year over year, the market was still downcast from a combination of exuberant consumption a year ago and a tenuous economic recovery, but the quarter also marked substantial growth from 1Q11, and total shipments topped over 17.8 million.
  • Europe, Middle East, Africa (EMEA) – The EMEA PC market continued to contract in 2Q11, in line with IDC’s forecast, as sustained high levels of inventory prevented stronger sell-in, particularly in Western Europe, where budget cannibalization from media tablets and smartphones continued to contribute to weak consumer demand and slow stock depletion. However, Central and Eastern Europe (CEE) and the Middle East and Africa (MEA) continued to expand and enjoyed positive growth overall.
  • Japan – The impact of the earthquake on PC buying proved to be limited, thus the market produced stronger results than expected, with 3% growth. Many commercial projects commenced as earlier fears of inventory shortage did not materialize. Coupled with continued average selling price (ASP) declines since the beginning of 2011, consumer shipments also fared better than expected.
  • Asia/Pacific (excluding Japan) – returned to double-digit growth of just over 12% as the market came in slightly above forecasts. A weak consumer market weighed down India, but other key markets like China continued their momentum to help offset this, despite the ongoing inflation challenges there.

Vendor Outlook -

  • HP grew 3% compared to the second quarter of 2010. The vendor saw good growth in key emerging markets and also EMEA, but also had a slight drop in volume compared to the previous quarter.
  • Dell saw growth of 2.8% worldwide. It managed to slow the pace of declines in key markets compared to the first quarter, with good gains in key emerging markets.
  • Lenovo outpaced Acer Group to become the number 3 vendor worldwide. It continued to reap the results of its channel expansion in markets outside of Asia/Pacific, garnering notable gains in the U.S. and Japan. All regions saw positive growth and total volume increased by nearly 23% on the year.
  • Acer shipments continued to decline from a year ago, but at a slower pace than in the first quarter as the company was affected by a review of inventory handling, as well uncertainties from its recent management shake-up.
  • ASUS grew 6% to overtake Toshiba for the number 5 spot. While the vendor has had some difficulties adjusting for the decline in Mini Notebook PCs, it mainstream notebooks did well, especially in emerging markets.

Top 5 Vendors, Worldwide PC Shipments, Second Quarter 2011 (Preliminary)

(Units Shipments are in thousands)

Rank Vendor 2Q11

Shipments

Market

Share

2Q10

Shipments

Market

Share

2Q11/2Q10

Growth

1 HP 15,263 18.1% 14,823 18.0% 3.0%
2 Dell 10,927 12.9% 10,626 12.9% 2.8%
3 Lenovo 10,276 12.2% 8,363 10.2% 22.9%
4 Acer Group 9,160 10.9% 10,190 12.4% -10.1%
5 ASUS 4,468 5.3% 4,216 5.1% 6.0%
Others 34,320 40.7% 34,070 41.4% 0.7%
All Vendors 84,413 100.0% 82,289 100.0% 2.6%

Source: IDC Worldwide Quarterly PC Tracker, July 13, 2011

Table notes follow the last table

Top 5 Vendors, United States PC Shipments, Second Quarter 2011 (Preliminary)

(Units Shipments are in thousands)

Rank Vendor 2Q11

Shipments

Market

Share

2Q10

Shipments

Market

Share

2Q11/2Q10

Growth

1 HP 4,692 26.3% 4,721 25.3% -0.6%
2 Dell 3,959 22.2% 4,408 23.7% -10.2%
3 Apple 1,917 10.7% 1,671 9.0% 14.7%
4 Toshiba 1,617 9.1% 1,560 8.4% 3.7%
5 Acer Group 1,513 8.5% 2,028 10.9% -25.4%
Others 4,159 23.3% 4,243 22.8% -2.0%
All Vendors 17,857 100.0% 18,632 100.0% -4.2%

Source: IDC Worldwide Quarterly PC Tracker, July 13, 2011

Table Notes:

  • Some IDC estimates prior to financial earnings reports.
  • Shipments include shipments to distribution channels or end users. OEM sales are counted under the vendor/brand under which they are sold.
  • PCs include Desktops, Portables, Mini Notebooks and do not include handhelds, x86 Servers and Media Tablets (i.e. iPad and Android-based Tablets). Data for all vendors are reported for calendar periods.
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