HP, Lenovo Lead Stagnant PC Market

Worldwide PC shipments experienced flat growth in the second quarter of 2014 after eight quarters of decline, according to a report from Gartner.

wordwide PC desktops and notebooks

While the PC market's installed base has been declining as consumers switch to tablets and smartphones for entertainment and social media consumption, worldwide PC shipments experienced flat growth in the second quarter of 2014 after eight quarters of decline, according to IT research firm Gartner.

In the U.S. market, PC shipments totaled 15.9 million units in the second quarter of 2014, a 7.4 percent increase from the second quarter of last year.

This was the second consecutive quarter of year-on-year shipment growth, with desktop and notebook PCs both exhibiting an increase in shipments.

Four of the top five vendors in the U.S. market experienced double-digit growth, with Hewlett-Packard (HP) as the market leader, accounting for 27.7 percent of PC shipments.

"The consumer PC market also started picking up in the U.S. The availability of affordable, thin and light notebooks have drawn consumers’ attention," Mikako Kitagawa, principal analyst at Gartner, said in a statement. "Touch-enable devices are also widely available with decreasing price premiums compared to a year ago. The price premium is low enough for mainstream consumers to spend the extra money for the additional functionalities, such as touch."

Lenovo extended its lead as the leader in worldwide PC shipments, as its worldwide market share increased to 19.2 percent, and the company’s PC shipments grew by double-digits in all regions except Asia/Pacific.

HP achieved its fastest global PC shipment increase since 2010, particularly in the Europe, Middle East and Africa (EMEA) region, where it saw shipments rise by 21 percent.

Dell saw its second consecutive quarter of double-digital global growth, with shipments rising in all regions, except Latin America, though Dell’s shipment decline was less than the regional average.

Strong demand for business PCs and noteworthy success in the Asia/Pacific region also helped Dell post a third-place finish with 13.3 percent market share.

In the "others" category of manufacturers there was a steep decline of 10 percent share as many smaller players saw their market share decline and others exited the PC market altogether, the report noted.

Over the last few years, many PC vendors have lost the economies of scale battle and were unable to maintain sufficient margin, according to Gartner analysts.

"We are seeing a slowdown in premium tablet sales, which have already penetrated a large number of households. PCs are now growing off a smaller installed base of newer devices, with more engaged users," Kitagawa said. "Therefore, we expect to see slow, but consistent, PC growth. While the end of support for Windows XP drove some of the sales in developed markets, it is the underlying business replacement cycle that will stabilize the market."