PC sales fall as corporates stay away

Worldwide sales of personal computers fell slightly during the second quarter of 2002 compared with the same period a year ago, suggesting the IT industry will not recover as quickly as some experts predicted earlier this year.

Preliminary results from technology research firm Gartner Dataquest also show the combination of Hewlett-Packard and Compaq moved the newly merged firm, HP, into top place in terms of market share in the PC industry.

HP tops the rankings for computer vendors with 15.5 per cent market share, but it experienced a 16.1 per cent decline in its shipments during the quarter, leaving it just 0.6 per cent ahead of second-largest vendor Dell.

HP's decline was based on inventory adjustments made during its integration with Compaq, its reliance on the weak-performing US retail segment and business disruption due to the merger process, said Gartner.

Dell was the only top-five vendor to experience double-digit growth in the second quarter. The firm also achieved the lowest ratio of operating expenses to revenue in its history in the year to May 2002.

Worldwide PC sales totalled 29.9 million units in the second quarter of 2002, a decline of 0.6 per cent from the same period in 2001. Computer shipments in the US were 10.6 million units, representing an 0.8 per cent decline.

Sales in Europe, the Middle East and Africa saw a decline of 0.3 per cent in the quarter, while Japan dropped 12 per cent. Asia Pacific and Latin America showed single-digit growth rates of 5 per cent and 4.3 per cent, respectively.

"We have yet to see any significant return to corporate buying and, in the consumer market, buying appears to have fallen back further in some regions," said Gartner. "Economic uncertainty continued to undermine business confidence, which has been further compounded in the US by Enron and the WorldCom MCI accounting scandals."

Gartner forecast worldwide unit shipment growth to be about 2 to 4 per cent in 2002, down from its previous estimate of 5 per cent.