The Latest PC Data Looks like a Typo, But It's Not

By
A A A
Share |

It's not uncommon for companies to miss on their revenue line, but when was the last time you saw a big company miss by nearly 50 percent? If the latest PC data issued on Wednesday were a company, its stock would look like a biotech that couldn't gain FDA approval on a late stage drug. It would be ugly.

If that sounds a bit overdramatic, here's why it's not. The latest IDC data found that PC shipments shrunk 14 percent year over year in the first quarter. IDC forecasted a year over year decline of 7.7 percent.

This represented the worst quarter since IDC began tracking PC shipments in 1994, and the fourth consecutive quarter of declines.

Why such an alarming decline?

Apple (NASDAQ: AAPL ), Samsung and Amazon (NASDAQ: AMZN ) may be locked in a cut-throat tablet war, but if the three are looking for something to agree on, it would be that they're crushing the PC market.

IDC reported in March that tablet shipments were up 78 percent year over year in 2012 and expected to pass PC shipments this year. That, along with phones that are slowly becoming big enough to be tablets, has left little room for the bulky desktop computer that feels so 20th-century.

It's not just desktops. By 2017, laptops could have an 11 percent share, according to IDC.

Microsoft (NASDAQ: MSFT ) didn't do much to breathe new life into the PC either. Companies heavily levered to the PC were hoping that Windows 8 would have the 'cool factor' of the Apple OS, but that hasn't happened. As of January of this year, Windows 8 only has a 2.26 percent market share-well below all other Windows operating systems and even OS X. OS X has the 'cool factor' but has about as much market share as the Windows phones.

In comparison, Windows 7 at the same point in its product cycle, had a 7.7 percent share.

IDC analyst Jay Chou said, "We don't have a lot of reason to be optimistic that the market will remain in more than replacement-cycle mode."

However you look at the numbers, this is bad news for companies like Hewlett-Packard (NYSE: HPQ ), Microsoft, and Dell (NASDAQ: DELL ).

Will the PC manufacturers attend the same, "why doesn't anybody like us anymore?" support group as J.C. Penney (NYSE: JCP )? Maybe Ron Johnson and Microsoft CEO Steve Ballmer will be fighting for that Apple retail job soon enough.

(c) 2013 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

Profit with More New & Research . Gain access to a streaming platform with all the information you need to invest better today. Click here to start your 14 Day Trial of Benzinga Professional



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Stocks

Referenced Stocks: AAPL , AMZN , DELL , HPQ , MSFT

Benzinga


More from Benzinga:

Related Videos

Stocks

Referenced

Most Active by Volume

89,970,926
  • $16.15 ▲ 0.12%
77,131,582
  • $58.94 ▼ 1.31%
67,336,935
  • $26.56 ▲ 1.68%
48,814,124
  • $86.20 ▲ 0.02%
47,526,126
  • $23.21 ▲ 0.78%
44,660,424
  • $23.91 ▲ 6.36%
38,799,699
  • $4.289 ▲ 4.36%
36,199,890
  • $40.01 ▼ 0.97%
As of 4/17/2014, 04:07 PM