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PC shipments grew faster than expected in 2Q



By JESSICA MINTZ, AP
16 July 2008 @ 05:42 pm EST

SEATTLE - Computer shipments rose faster than expected in the second quarter, fueled by exceptional demand in emerging markets and a decline in prices in the U.S. and Western Europe, two research groups said Wednesday.

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Worldwide shipments increased 16 percent from a year ago to 71.9 million PCs, according to Stamford, Conn.-based Gartner Inc. The company had predicted 11.2 percent growth.

IDC, a technology research group based in Framingham, Mass., that uses different methods to track sales, found a 15.3 percent rise, to 70.6 million computers.

Gartner analyst Mika Kitagawa attributed some of the surge to ongoing trends: rising shipments to emerging markets like China, Brazil, India and Russia; and the increasing number of computers per home thanks to the popularity of laptops. The power of the laptop segment was evident a day earlier, when chip maker Intel Corp. said second-quarter profit jumped 25 percent on ballooning global demand for the processors that serve as the brains of notebook computers.

However, Kitagawa hadn't foreseen the way economic jitters in mature markets would positively affect PC shipments in the quarter.

The analyst had forecast less than 2 percent growth in the U.S. in the shadow of its mortgage and credit market turmoil. But those troubles pushed down PC average selling prices, sparking a 4.2 percent increase in U.S. shipments.

Loren Loverde, director of IDC's quarterly PC report, attributed less of the growth to sales spared by falling prices, though he acknowledged aggressive price competition in mature markets.

Both research groups found that Palo Alto, Calif.-based Hewlett-Packard Co. held on to the top spot in the global market, which it wrested from Dell Inc. in 2006.

But as in the first quarter, Dell's decision to expand sales of computers to retail stores helped it gain ground.

Gartner found Round Rock, Texas-based Dell's shipments grew 22 percent while HP shipments rose a slower 17 percent.

Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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