Why Apple Leaves Low-End Computers to the Competition

It's no secret that Apple (AAPL) is doing really well at the high end of the personal computer business, but the other day I got some data that cast its recent achievements in a whole new light. In September, according to market researcher NPD Group, Macs accounted for 18.9% of all laptops and desktops sold in U.S. retail outlets. For computers priced above $1,000, Apple's share was an astonishing 89%.

The NPD numbers overstate Apple's dominance to some degree. They exclude most sales to large enterprises, which strongly prefer high-end PCs to Macs. Still, the business implications are inescapable. While competitors such as Hewlett-Packard (HPQ), Acer, and Dell (DELL) sell vast volumes of $500 laptops that yield razor-thin profit margins, Apple—whose cheapest MacBook sells for $999—is raking in the lion's share of the industry's profits.