PC Shipments Mark Steepest Decline With 10 Percent Drop

A Lenovo Group Ltd. computer. Daniel Acker/Bloomberg Close

A Lenovo Group Ltd. computer. Daniel Acker/Bloomberg

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A Lenovo Group Ltd. computer. Daniel Acker/Bloomberg

Personal-computer shipments fell 10 percent in 2013, marking the worst-ever decline after lackluster holiday sales underscored how consumers and businesses are shunning machines for mobile devices, two research firms said.

Manufacturers shipped 315.9 million units, returning to 2009 levels and making it the “worst decline in PC market history,” researcher Gartner Inc. said in a statement yesterday. IDC also said shipments had a record decline.

U.S. consumers omitted PCs from their holiday shopping lists while buyers in Asia opted for smartphones and tablets. More computing tasks are moving to websites and applications tailored for wireless gadgets, rather than software installed on laptops and desktops. The annual drop eclipsed the previous record decline of 3.9 percent in 2012, Gartner said.

“Consumer spending during the holidays did not come back to PCs as tablets were one of the hottest holiday items,” said Mikako Kitagawa, an analyst at Stamford, Connecticut-based Gartner. “In emerging markets, the first connected device for consumers is most likely a smartphone, and their first computing device is a tablet.”

Global sales fell 6.9 percent in the fourth quarter -- the seventh straight drop -- to 82.6 million units, Gartner said. IDC, based in Framingham, Massachusetts, reported a decline of 5.6 percent in the same period.

Photographer: Nelson Ching/Bloomberg

Workers unload Lenovo Group Ltd. computers from a tricycle at a computer market in Beijing. Lenovo Group Ltd. maintained the No. 1 spot worldwide with 18.1 percent market share in the fourth quarter, helped by a 6.6 percent increase in shipments, according to Gartner Inc. Close

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Photographer: Nelson Ching/Bloomberg

Workers unload Lenovo Group Ltd. computers from a tricycle at a computer market in Beijing. Lenovo Group Ltd. maintained the No. 1 spot worldwide with 18.1 percent market share in the fourth quarter, helped by a 6.6 percent increase in shipments, according to Gartner Inc.

Corporate Upgrades

Lenovo Group Ltd. (996) maintained the No. 1 spot worldwide with 18.1 percent market share in the fourth quarter, helped by a 6.6 percent increase in shipments, according to Gartner. Hewlett-Packard Co. (HPQ) was second with a 16.4 percent share as shipments declined 7.2 percent. Dell Inc. was third, the researcher said.

“We are extremely optimistic about the future of the $200 billion-plus PC industry,” Yang Yuanqing, Lenovo’s chairman and chief executive officer, said in a statement. “We continue to outperform the market while steadily improving profit and margin.”

Lenovo shipped 14 million PCs in the last quarter, it said.

Growth in the PC market has become dependent on consumers and businesses replacing existing machines, rather than wooing new buyers. Enterprise demand is being driven in part by Microsoft Corp. (MSFT)’s plan to end support for its 13-year-old Windows XP operating system in April, compelling businesses to buy new PCs along with software upgrades.

U.S. shipments shrank 7.5 percent in the fourth quarter to 15.8 million units, Gartner said. Unit sales in Europe, the Middle East and Africa fell 6.7 percent to 25.8 million, while the Asia-Pacific region saw a 9.8 percent decline to 26.5 million.

Photographer: Dhiraj Singh/Bloomberg

An employee arranges refurbished desktop computers at a recycling facility in the Raipur industrial area of Bhagwanpur in Roorkee, Uttarkhand, India. Close

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Photographer: Dhiraj Singh/Bloomberg

An employee arranges refurbished desktop computers at a recycling facility in the Raipur industrial area of Bhagwanpur in Roorkee, Uttarkhand, India.

Loren Loverde, an analyst at IDC, said the decline in PC shipments was the worst since the researcher started tracking data in 1981, with the previous record seen in 2001, when sales shrank 3.7 percent.

“We don’t think it’s quite the bottom yet,” Loverde said. IDC is predicting a 3.8 percent decline in PC shipments for 2014 this year, and then growth of less than 1 percent in 2015, he said.

To contact the reporter on this story: Aaron Ricadela in San Francisco at aricadela@bloomberg.net

To contact the editor responsible for this story: Pui-Wing Tam at ptam13@bloomberg.net

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