Gartner: Declining worldwide PC shipments in Q4 of 2012 signal structural shift

Worldwide PC shipments totaled 90.3 million units in the fourth quarter of 2012, a 4.9 percent decline from the fourth quarter of 2011, according to preliminary results by Gartner. Analysts said the PC industry’s problems point to something beyond a weak economy.

PC shipments in Asia/Pacific totalled 29.9 million units in the fourth quarter of 2012, a 1.8 percent decline from the fourth quarter of 2011. Vendors struggled to offer compelling products to convince buyers to upgrade and attract new buyers as consumers’ interest continues to be on smartphones and tablets. The introduction of Windows 8 met with lukewarm response and availability was primarily on the higher-end models, which were priced beyond the mainstream price point for volume sales.

“Tablets have dramatically changed the device landscape for PCs, not so much by ‘cannibalizing’ PC sales, but by causing PC users to shift consumption to tablets rather than replacing older PCs,” said Mikako Kitagawa, principal analyst at Gartner. “Whereas as once we imagined a world in which individual users would have both a PC and a tablet as personal devices, we increasingly suspect that most individuals will shift consumption activity to a personal tablet, and perform creative and administrative tasks on a shared PC. There will be some individuals who retain both, but we believe they will be exception and not the norm. Therefore, we hypothesise that buyers will not replace secondary PCs in the household, instead allowing them to age out and shifting consumption to a tablet.”

“This transformation was triggered by the availability of compelling low-cost tablets in 2012, and will continue until the installed base of PCs declines to accommodate tablets as the primary consumption device,” Ms. Kitagawa said. “On the positive side for vendors, the disenfranchised PCs are those with lighter configurations, which means that we should see an increase in PC average selling prices (ASPs) as users replace machines used for richer applications, rather than for consumption.”

During the holiday season, consumers no longer viewed PCs as the number one gift item. Given a burgeoning variety of increasingly more attractive devices and services, consumers directed their attention elsewhere. Analysts said there was uptake of very low priced notebooks as a part of mega holiday deals, but this uptake did little to boost holiday PC sales.

The launch of Microsoft’s Windows 8 did not have a significant impact on PC shipments in the fourth quarter. Analysts said some PC vendors offered somewhat lacklustre form factors in their Windows 8 offerings and missed the excitement of touch. New products are coming to market, and this could drive churn within the installed base.

HP regained the top position in worldwide PC shipments in the fourth quarter of 2012 (see Table 1). However, the company’s shipments did not grow compared to a year ago. Analysts said HP most likely gave up a certain margin level to gain market shares. HP was successful in managing large retail deals targeting Microsoft’s Windows 8 launch and holiday sales in selected regions.

Table 1: Preliminary Worldwide PC Vendor Unit Shipment Estimates for 4Q12 (Units)

Note: Data includes desk-based PCs and mobile PCs, including mini-notebooks but not media tablets such as the iPad. Data is based on the shipments selling into channels.

Source: Gartner (January 2013)

Lenovo dropped to the No. 2 position in the fourth quarter of 2012, but it experienced the best growth rate (8.2 percent) among the top 5 PC vendors worldwide. Lenovo’s growth exceeded regional growth rates in North America, EMEA and Asia/Pacific, but lower than the industry average in Latin America and Japan. In EMEA, Lenovo had a 30 percent increase in PC shipments, indicating its continuous expansion in the market. In North America, Lenovo performed well by expanding in the retail market and protecting professional market.

Full year 2012
For the year, PC shipments were 352.7 million units, a 3.5 percent decline from 2011 (see Table 4). HP retained the top spot in the global PC market, accounting for 16 percent of the market. Lenovo was the No. 2 vendor with 14.8 percent market share. ASUS showed the strongest growth among the top 5 vendors, with shipments increasing 17.1 percent.

Table 2: Preliminary Worldwide PC Vendor Unit Shipment Estimates for 2012 (Units)

Note: Data includes desk-based PCs and mobile PCs, including mini-notebooks but not media tablets such as the iPad. Data is based on the shipments selling into channels.

Source: Gartner (January 2013)