Acer, Dell Battle in PC Market: Analysis

Acer and Dell have long battled for the No. 2 worldwide PC maker position. During the second quarter of 2010, the winner depends on who you ask-Gartner gave it to Acer, while IDC early estimates favor Dell.

The worldwide PC market is continuing to rebound, according to second-quarter numbers released July 14 by research firms Gartner and IDC. The bigger question is where Acer and Dell fit in the space.

Worldwide, corporate PC purchases helped fuel much of the growth, taking some of the burden off of consumers, according to the two analyst firms. Gartner estimates that the PC market rose 20.7 percent over the second quarter of 2009, while IDC nudged the figure to 22.4 percent.

While Hewlett-Packard undisputedly led both rankings, shipping 14.8 million units by IDC's estimate and 14.5 million by IDC's, when it came to the No. 2 position, conclusions varied. Acer and Dell have paced neck-and-neck over several quarters. For the second quarter, Gartner kept Acer at number two - estimating that it shipped 10.8 million units for 13 percent market share, to Dell's 10.3 million, for 12.4 percent of the market. IDC, however, reported shipments of 10.6 million units for Dell, followed by Acer with 10.2 million units.

In the United States, the firms agreed, it was Dell that pulled ahead. By IDC's estimate, the Texas computer maker shipped 4.4 million units for 24 percent market share-creeping up on HP's first-place lead, with 25.7 percent. Both estimated Acer to have shipped approximately 2 million units, for about an 11 percent market share.

By both accounts, Lenovo came in fourth place, with shipments of approximately 8.3 million units. Garter ranked Asus in fifth position-estimating that it shipped 4.3 million units, for 5.2 percent market share, topping No. 6 Toshiba's 4.2 million units and 5.1 percent share. IDC, however, tied the two for fifth place, with estimated shipments of 4.34 million units going to Toshiba, an estimated 4.32 million units to Asus and a market share of 5.3 percent for each.

In the United States, the firms' figures again ran closer, with each giving third-place to Acer, with shipments of approximately 2 million units, and fourth-place to Apple, with 1.6 million units and approximately 8.8 percent market share, per IDC (Gartner gave Apple a more generous 1.7 million units, for a 9.8 percent share). Toshiba finished fifth in the United States, with shipments of about 1.6 million units and 8.5 percent market share.

Enterprise refreshes of aging systems largely contributed to the quarter's growth, analysts at both firms agreed.

"The surge in consumer activity seen in the past two quarters has started to slow as expected, while commercial replacements continue to grow," Bob O'Donnell, an IDC vice president, said in a statement. "We expect consumer activity to remain healthy, but gradually slow through the end of the year, while commercial market growth will be more stable, reflecting a planned replacement cycle over the next several years."

Sales of consumer-geared netbooks, or mini-notebooks, which helped to buoy flagging PC sales in past quarters, still resulted in strong, though slowing, numbers.

"Mini-notebook shipment growth still exceeded growth rates of the overall mobile PC market, but mini-notebook growth slowed to the low 20 percent range compared with more than 70 percent in the last two quarters," Gartner analyst Mikako Kitagawa said in a statement. "This slowdown indicates that mini-notebooks are entering a mature growth stage. "

Kitagawa added that, in the U.S. market, the "surging popularity of Apple's iPad temporarily cannibalized mini-notebooks, as well as consumer notebook sales to some degree."

Asus, a major provider of netbooks, nonetheless performed strongly on the global stage, posting year-on-year growth figures of 78.5 percent by Gartner's estimate and 83.6 percent by IDC's - by far the strongest growth of any company.

Leader HP, however, posted year-on-year growth of 12.3 percent, which well below the global market average. While average selling prices declined during the quarter, according to Gartner's Kitagawa, HP reportedly "did not participate in the aggressive pricing that was seen in Asia/Pacific."

Equity firm Raymond James, however, responding to the IDC figures, reminded investors in a July 15 research note: "While IDC's reported 12 percent growth would suggest modest downside relative to our projection, we remind investors that IDC's statistics are based on calendar quarters, whereas HP's quarter ends a month later."