PC shipments hit by consumer slump

New figures highlight a steep drop in consumer demand in the past few weeks, though shipments of laptops were healthy

An increased demand for notebook computers was one of the few bright spots for the European PC business for the first quarter, which featured sluggish purchasing from corporations and a steep drop in consumer demand following the commencement of hostilities in Iraq, according to new figures.

Research firm Gartner, which released preliminary PC shipment figures for the first quarter of the year on Wednesday, said that the sector showed modest growth in Europe, the Middle East and Africa. But the figures are deceptive, according to Gartner analyst Brian Gammage. "The PC market in EMEA performed slightly above expectations in quarter one, but it masks a sharp decline in consumer demand for PCs during the final weeks, hitting local PC vendors hardest. The slowdown in consumer demand has also been carried into April and will impact the PC market during the second quarter," Gammage said.

The period of consumer slowdown corresponds to the US and UK-led assault on Iraq, which also affected spending on other types of electronics, and caused house prices to decline.

HP was the largest PC vendor for the quarter, with a 19.3 percent market share and shipping about two million units. However, HP's market share was 3.2 percent lower compared with the same quarter last year.

By contrast, Dell grew by 21.7 percent over the first quarter of 2002, taking 11.2 percent of the market with about 1.2 million units shipped. Gartner said that Dell was the main beneficiary of stronger corporate demand for PCs.

Gartner predicted that PC demand in corporations would remain modest for the rest of the year, topping out at 6 or 7 percent.

Laptop computer demand was higher across consumer and enterprise segments, partly due to a new generation of mobile products coming onto the market. Vendors have introduced buyer incentives and cut prices to make way for the new products, Gartner said.

AMD and Intel have both introduced new generations of mobile processors, with Intel spending $300m (about £190m) to advertise its Centrino group of laptop chips.

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