DELL Dell Inc. (MM)

The overall Personal Computer (PC) market is witnessing a downward trend, as elucidated by a year-over-year decline of 1.1% in PC shipments to 84.3 million during the first quarter of 2011. Technology research firms, IDC and Gartner unanimously confirmed the fact that there was a drop in PC sales compared with the year-ago quarter. The main reason behind the declining PC sales is the growing popularity of Apple’s (AAPL) iPad, which continues to take significant market share from the PC and notebook markets.

Gartner and IDC expected PC sales to grow 3.0% and 1.5%, respectively. Apart from the growing popularity of the iPad, consumers did not show much interest in buying cheap PCs, a product category that acts as a major catalyst in PC sales growth.  Rather, they were interested in tablet computers and other consumer electronic products.

Weaker consumer demand in the U.S. as well as in other European regions also impacted PC sales to some extent.

IDC opines that PC manufacturers must adopt a better sales technique for computers instead of simply displaying their hardware specifications in order to succeed in the PC business.

According to IDC, total PC shipments were 92 million in the fourth quarter of 2011. Gartner’s estimate was close at 93 million. IDC measured a 2.7% increase over the past year, while Gartner estimated a 3.1% increase.

IDC found Hewlett-Packard Company (HPQ) to be the #1 PC supplier globally, with a market share of 18.9%, up from 18.8% in the fourth quarter of 2010. Dell Inc. (DELL) held the second position with 12.8% market share, up from 12.7% in the prior quarter, closely followed by Acer with an 11.2% share of the market.

Further, according to IDC, Hewlett-Packard is the market leader in the U.S, with 27.0% market share, followed by Dell (23.1% market share), Toshiba (10.3% share) and Apple Inc. (8.5%). 

However, competition is expected to intensify among the industry players in 2011, with every major player introducing new products.

 
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