RealTime IT News

HP Receives Some Good News

Hewlett-Packard received some good news for a change: regaining first place for the third quarter in worldwide PC shipments since 2003.

However, the Gartner survey found Dell remained No. 1 in the U.S., despite experiencing its lowest growth ever.

Although HP's lead is by a slim 110,000 units, the research firm reported the computer maker saw worldwide PC shipments during the third quarter of 2006 jump 15.4 percent over the same period last year.

The increase mirrored a 6.7 percent rise in overall worldwide PC shipments totaling 59.1 million units, according to Gartner. HP's worldwide market share increased to 16.3 percent, according to the researchers.

"HP continues to take better advantage of the faster growth segments such as the consumer market," Mikako Kitagawa, principal analyst for Gartner Dataquest's Client Computing Markets Group, said in a statement.

Merrill Lynch echoed that belief, viewing HP stock as a "buy" and looking upon Dell as neutral. The news of its dethronement sent Dell stock down 5 percent.

Reflecting a downturn in U.S.-based PC shipments, Dell's PC market share slipped to 16.1 percent. The 2 percent dip in PC demand in the U.S. harkened back to the second quarter of 2002, when the last decline in the U.S. market happened, according to Gartner.

Contributing to the downturn were a weakness in the professional desk-based market and strong sales during the second quarter, according to the analyst.

"Strong sales to the home market, fueled by back-to-school sales and mobile PCs could not offset the decline in other areas," according to Gartner.

Dell has underperformed the market for the first time since 2000, said Ranjit Atwal, a Gartner analyst in the Europe, Middle East and Africa (EMEA) regions, in a statement.

While PC sales in the U.S. were down, EMEA sales rose 9.1 percent to 18.5 million units, over the same period last year.

HP held the top spot in EMEA, according to Gartner. The results seem in line with similar findings reported at the start of 2006.

"We suspect elasticity may be causing Dell's unit rate to slow as it takes a less aggressive price stance in certain markets," Merrill Lynch said.

Based on today's data on slowing in the U.S., the financial analysis house lowered its estimates for fourth quarter growth in PC shipments from 8.6 percent to 7.5 percent, noting some users may wait until Vista is released before buying PCs.

The news on PC shipments follows reports last month of a series of stumbles that resulted in Dell announcing its stock could face delisting.

At midmorning, HP's stock was up 1.61 percent to $39.59 and Dell shares fell 5.95 percent to $23.23.