PC sales top expectations in the US

The strength of the US market for PCs last year surprised analysts, as economic concerns failed to dampen PC sales in the region in the last quarter of 2007. Worldwide, the market grew more slowly than they expected as worldwide sales reached 270 million units for the full year.

Economic concerns failed to dampen PC sales in the US in the last quarter of 2007. But the worldwide market was slower than analysts expected, as shipments reached 270 million units for the full year.

Technology research firm IDC said that global personal computer sales rose a healthy 15.5 per cent in the fourth quarter, but less than expected, and that economic concerns were likely to cut into future demand. Gartner provided a lower number for fourth-quarter growth 13.4 per cent but the two analysts were in broad agreement over the total number shipped for the quarter: around 76 million units.

Investors have been watching for signs of whether the PC market would deteriorate in the face of a possible recession in the United States, fears that were fanned on Tuesday by disappointing results from chipmaker Intel.

But fourth-quarter US PC unit sales rose 8.8 per cent, topping IDC's 6.9 per cent forecast. For the year, Gartner said US sales were higher than expected.

IDC analyst David Daoud said the industry had weathered recessions without major impact in the past. But there has been no recession since the industry had matured, he said.

"We projected a 12.2 per cent growth for 2008, projections that could be challenged by the potential economic downturn, in the US in particular," he said.

Researchers said global sales missed the IDC target of 16.7 per cent because of relative weakness in Western Europe. But they said the economy was not to blame; rather consumers slowed purchases from a PC buying frenzy in the third quarter. According to Gartner, the region of Europe, Middle East and Africa (EMEA), has become the most important region for PC sales because of rapid growth in Eastern Europe, the Middle East and Africa, said Mikako Kitagawa, principal analyst for Gartner's client computing markets group.

"Asia/Pacific took over as the second largest PC market during the fourth quarter. 2007 showed a clear indication of the worldwide PC market landscape: strong growth in emerging regions such as Asia/Pacific and slower growth in markets such as the US."

According to Kitagawa, Hewlett-Packard extended its lead in the market in 2007, accounting for 18.2 per cent of global PC shipments. "HP established a solid number one position in 2007. Robust consumer and mobile PC sales across all regions were two main drivers of HP's overall growth. The company experienced the strongest growth among the top-five vendors in the fourth quarter of 2007, as its shipments increased 23.3 per cent in the quarter."

Although Dell's PC shipments grew just 1.7 per cent in 2007, the company showed signs of a recovery at the end of the year as it registered positive year-over-year growth for two consecutive quarters. In the fourth quarter of 2007, Dell's worldwide PC shipments grew 17 per cent, as its market share reached 14.5 per cent, said Gartner.

Image: The innards of a PC

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