When Will PC Sales Rebound?
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iSuppli is the latest market research firm to weigh in with first-quarter 2009 PC sales, and like the numbers from Gartner and IDC, the findings aren't pretty.
It reports that worldwide PC shipments in the first quarter fell by the largest rate in the seven years that iSuppli has been tracking the market.
PC shipments in the first quarter of 2009 fell 8.1 percent over the same period in 2008, from 72.3 million to 66.5 million units in 2009. When compared to the end of last year, the drop is even larger, down 14.4 percent from the 77.6 million units shipped during fourth quarter -- a period when shipments had already begun to slow as the economy started heading south.
The drop is very lopsided, however. Desktop computer sales dropped by 23 percent compared to the same period in 2008 while notebook shipments -- which includes netbooks -- grew 10 percent in the same time period.
Because of this tilt toward portable, Toshiba, which has no desktop business, was the big winner of the quarter, with sales up 13.2 percent year-over-year. Acer, which is one of the leaders in netbooks, managed a 9.5 percent gain.
HP (NYSE: HPQ), the overall market leader, managed to scrape by with a 0.4 percent gain to hold on to the top spot. It had 19.7 percent of total sales for the quarter. In second place and falling fast was Dell (NASDAQ: DELL), which has a large desktop PC business and is heavily dependent on the U.S.
This conspired to result in a 18.7 percent drop in sales year-over-year for the company. Dell held 13.2 percent market share for the quarter, with Acer hot on its trail at 11.1 percent.
"The first-quarter performance of the worldwide PC market was worse than iSuppli had expected in its prior forecast, which called for a 4 percent decline in shipments compared to the same period in 2008," Matthew Wilkins, principal analyst for compute platforms research at iSuppli, said in a statement.
Netbook sales continue to be strong thanks to the new deals hardware makers are striking with ISPs. "The bundling of a low-cost portable computer and an Internet access package clearly has struck a chord with consumers," Wilkins said.
iSuppli predicts netbooks will account for 14 percent of worldwide notebook PC shipments in 2009, up from 9 percent last year.
Comeback time? Maybe.
So are things on the rebound? Intel (NASDAQ: INTC) CEO Paul Otellini declared the market had bottomed out during the company's second-quarter financial call, although the claim was soon refuted by AMD (NYSE: AMD) CEO Dirk Meyer.
FBR Capital Markets conducted its routine checks with notebook and desktop ODMs and motherboard makers and found that the turnaround of just a few months ago has weakened.
The company said its contacts now expect notebook builds will grow 10 percent over the first quarter, versus the 11 percent quarter-over-quarter growth last month and 14 percent quarter-to-quarter growth two months ago.
The company had been forecasting a 7 percent quarter-over-quarter increase just two months ago. Now it's expecting 1 percent growth.
"This second negative build revision (following three positive revisions from mid-February to mid-April) are due to continuing weak demand in Europe, transitional issues with Intel's ramping consumer ultra-low voltage (CULV) notebook CPUs, and some component shortages for LED backlights, LCD panels, optical disk drives, and Ethernet chips," the company wrote in a research note.
"Component shortages could potentially worsen given seasonal strength in 2H09, which might cause some hording and double-ordering activity," it said.
FBR Capital Markets also predicted Intel's third-quarter revenues may grow 4 percent to 8 percent over the second quarter, to a range of $7.5 billion to $8.1 billion, slightly ahead of the Wall Street estimate of $7.7 billion.