The PC market surges in Q1 2018 – HP tops revenue, Lenovo – shipments

The PC market is growing in vendor revenues (16% to $40b in Q1; 14% to $159b in the year to the end of March), unit shipments (14% to 59m, 11% to 235m respectively) and unit installed base (1% to 846m). My Figure shows that Lenovo was the world leader in terms of shipments and its installed base, while HP Inc. made most revenue due to a richer mix of higher priced products including workstations). Dell held third – and Apple fourth – place in revenues, shipments and installed base (see my Figure).

I remember the ‘PC is dead’ stories of a few years ago when Apple and others launched smart tablets. It survived both as a product type and as an vitally important part of the overall IT market, while smart tablets reached a peak some years ago. There has been increasing vendor consolidation as Sony, Fujitsu and others have pulled out or back on their own production of PCs and a couple of major vendors (Lenovo and Microsoft) are relative new comers to the hardware business.

Intel and AMD both delivered new innovative chips last year, which led to the increases in average selling prices and installed base, while there continues to be a bias towards the Americas (see my Figure), of which the USA represents around 74% in revenues.

The basic PC form factor appears to be set in stone in terms of the use of x86 chips and Microsoft Windows operating systems with the exception of Apple (which has its own operating system, but still uses Intel chips) and Chromebook – a generic name for a set of low-end PCs which tend still to be based on x86 chips (albeit Celeron ones by and large), but use Google Chrome instead of Windows. In many medium and large businesses users have chosen to introduce ‘virtual’ desktops based on Citrix and other suppliers’ software, which has lengthened the time before replacement of their physical PCs in use. Time will see the extent to which the current surge in sales will be continued into the rest of 2018.