Gartner Says Hewlett-Packard Takes Clear Lead in Fourth Quarter Worldwide PC Shipments and Creates a Virtual Tie with Dell for 2006 Year-End Results

STAMFORD, Conn.--(BUSINESS WIRE)--For the second consecutive quarter, Hewlett-Packard was the No. 1 vendor based on worldwide PC shipments, and it finished 2006 tied with Dell as the leader of worldwide PC shipments, according to preliminary results by Gartner, Inc.

“PC price erosion was a defining feature of the quarter”

According to Gartner, worldwide PC unit shipments in the fourth quarter of 2006 grew 7.4 percent compared to a year ago. During the quarter, 67.3 million units were shipped.

In the fourth quarter of 2006, Hewlett-Packard’s worldwide PC shipments increased 23.9 percent, as its market share totaled 17.4 percent (see Table 1). Dell remained in the No. 2 position in the quarter, but its shipments decreased 8.7 percent, resulting in its market share total of 13.9 percent.

Gartner analysts said the overall PC market was impacted by stiff competition from the consumer electronics industry and the upcoming Vista launch.

“PC price erosion was a defining feature of the quarter,” said Mikako Kitagawa, principal analyst for Gartner Dataquest’s Client Computing Markets Group. “In the consumer market, the PC industry battled for wallet share against other consumer electronics products, such as games consoles and flat panel TVs, while at the same time cutting prices to ensure market demand did not stall prior to Microsoft’s Vista consumer launch in January.”

Table 1 Preliminary Worldwide PC Vendor Unit Shipment Estimates for 4Q06 (Thousands of Units)
Company	4Q06 Shipments	4Q06 Market Share (%)	4Q05 Shipments	4Q05 Market Share (%)	4Q06-4Q05 Growth (%)
Hewlett-Packard	11,687	17.4	9,431	15.0	23.9
Dell Inc.	9,385	13.9	10,284	16.4	-8.7
Lenovo	4,773	7.1	4,365	7.0	9.3
Acer	4,593	6.8	3,451	5.5	33.1
Toshiba	2,576	3.8	2,070	3.3	24.5
Others	34,339	51.0	33,085	52.8	3.8
Total	67,352	100.0	62,686	100.0	7.4
Note: Data includes deskbased PCs, mobile PCs and X86 servers. Source: Gartner Dataquest (January 2007)

Fourth quarter PC shipments in the U.S. decreased 3.2 percent. This was the second consecutive quarter that U.S. market showed a year on year decline.

Gartner analysts said the weakness in the U.S. market was attributed largely to weaker than expected shipments into the home market. In the fourth quarter of 2006, home desk-based PC shipments declined more than 20 percent from the fourth quarter of 2005 while mobile PC shipments increased more than 20 percent.

Dell maintained the No. 1 position in the U.S. PC market in the fourth quarter of 2006 (see Table 2), but its PC shipments declined 17.3 percent, equivalent to a market share of 29.1 percent. HP’s shipments increased 16 percent giving it a 25.3 percent unit market in the fourth quarter.

“Dell’s market share was its lowest in four years. It lost market share across all segments in the U.S., particularly the home market,” Ms. Kitagawa said. “The fourth quarter’s consumer bias favors HP, however Dell’s accelerated shipment decline in the fourth quarter is surprising.”

Table 2 Preliminary U.S. PC Vendor Unit Shipment Estimates for 4Q06 (Thousands of Units)
Company	4Q06 Shipments	4Q06 Market Share (%)	4Q05 Shipments	4Q05 Market Share (%)	4Q06-4Q05 Growth (%)
Dell Inc.	4,651	29.1	5,622	34.0	-17.3
Hewlett-Packard	4,051	25.3	3,491	21.1	16.0
Gateway	1,133	7.1	1,145	6.9	-1.1
Toshiba	852	5.3	697	4.2	22.3
Apple Computer	808	5.1	619	3.7	30.6
Others	4,507	28.2	4,956	30.0	-9.1
Total	16,002	100.0	16,530	100.0	-3.2
Note: Data includes deskbased PCs, mobile PCs and X86 servers. Source: Gartner Dataquest (January 2007)

Worldwide PC shipments totaled 239 million units in 2006, a 9.5 percent increase from 2005. The Europe, Middle East and Africa (EMEA) region continued to be the largest PC region during the year. Asia/Pacific and Latin America also well exceeded the worldwide industry growth average. U.S. PC shipments were well below the worldwide average to show the clear evidence of market saturation.

Dell and HP shared the No. 1 position in 2006, as both vendors had worldwide PC shipment market share totals of 15.9 percent (see Table 3). Toshiba moved into the worldwide top 5 table, surpassing Fujitsu/Fujitsu Siemens.

Table 3 Preliminary Worldwide PC Vendor Unit Shipment Estimates for 2006 (Thousands of Units)
Company	2006 Shipments	2006 Market Share (%)	2005 Shipments	2005 Market Share (%)	2006-2005 Growth (%)
Dell Inc.	38,054	15.9	36,752	16.8	3.5
Hewlett-Packard	38,033	15.9	31,902	14.6	19.2
Lenovo	16,646	7.0	15,010	6.9	10.9
Acer	13,864	5.8	10,115	4.6	37.1
Toshiba	9,184	3.8	7,216	3.3	27.3
Others	123,642	51.6	117,630	53.8	5.1
Total	239,424	100.0	218,626	100.0	9.5
Note: Data includes deskbased PCs, mobile PCs and X86 servers. Source: Gartner Dataquest (January 2007)

For 2006, U.S. PC shipments totaled 61.1 million units, a 1.2 percent increase from 2005.

PC shipments in EMEA totaled 80.3 million units in 2006, a 10.8 percent increase from 2005. The region ended the year with a strong fourth quarter, as shipments totaled 25.7 million units, an 11.9 percent increase from the fourth quarter of 2005. In the fourth quarter of 2006, the EMEA PC market suffered from weaker demand in Western Europe, in particular from Germany and the Nordic countries. The impending arrival of Vista seemed to have little effect on consumer demand, except to keep prices lower; consumers continued to purchase PCs at the entry level price points.

In Asia/Pacific, PC shipments reached 59.9 million units in 2006, a 17.2 percent increase from 2005. In the fourth quarter, PC shipments reached 15.7 million units, a 13.3 percent increase. In the fourth quarter demand was primarily soft as buyers were prepared to wait one more month for PCs installed with Vista. Consumers were also distracted by aggressive prices of LCD TVs.

The Latin America PC market had a strong year with shipment growth of 24.7 percent in 2006, with shipments totaling 18.6 million units. In the fourth quarter, shipments exceeded 5.4 million units, a 22 percent increase from the fourth quarter of 2005. The fourth quarter was dominated by the consumer market due to the holiday season, and the end-of-year “budget cleaning” by some enterprises and a few government offices.

In Japan, PC shipments totaled 14.2 million units in 2006, a 3.3 percent decline from 2005. The Japan market experienced a difficult fourth quarter, as shipments approached 3 million units, a 12.6 percent decline from the fourth quarter of 2005. Both the professional and private market showed negative year-over-year growth in the fourth quarter.

These results are preliminary. Final statistics will be available soon to clients of Gartner's PC Quarterly Statistics Worldwide by Region program. This program offers a comprehensive and timely picture of the worldwide PC market, allowing product planning, distribution, marketing and sales organizations to keep abreast of key issues and their future implications around the globe. Additional research can be found on Gartner's Computing Hardware section on Gartner's Web site at http://www.gartner.com/it/products/research/asset_129157_2395.jsp.

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