The PC Market Has Its Strongest Quarter In Recent Memory

Personal computers, long an ailing member of the larger technology market had a strong second quarter. After consistent quarters of decline, the worldwide PC market was either up 0.1%, or down a modest 1.7% in the period, according to Gartner and IDC respectively. In the United States, the PC market was up around 7% in the quarter, again according to the two firms.

A growing PC market? Don’t be too surprised, the end support for Windows XP has driven business demand for new computers as aging systems were made obsolete by the final demise of the now-ancient operating system,

Estimates vary based on how the market is counted — IDC doesn’t count Windows-based tablets, but does count Chromebooks; Gartner is the opposite — but all told the massive declines that the market for personal computers has sustained all but stopped in the quarter, which saw around 75 million units sold.

That figure, of course, puts the PC market on a roughly 300 million unit run rate, in keeping with prior estimates.

The augurs here are good for constituent members of the PC market, such as Microsoft and Intel. Both companies declined to comment in the new PC market’s most recent performance. Intel recently raised its forecast for the quarter, as TechCrunch reported:

For the second quarter, Intel expects revenue of $13.7 billion, plus or minus $300 million. This is greater than its prior expectation of $13 billion, plus or minus $500 million. So, on the top and bottom, Intel could see revenue of $14 billion in the second quarter, up from its lowest prior guidance band of $12.5 billion.

At issue here is the short-term impact of the end of Windows XP which could, I think reasonably, provide a few quarters of lift for the PC market. After that, the steroid will wear off. Aside from XP itself, Gartner sees “stabilization” in PCs, and IDC sees “returning consumer interest.” Both could provide longer-term momentum for PCs.

I doubt that PC volume will return to its prior heights, given the growing popularity of mobile computing — it’s up to you want to want to count in the PC category, of course — but at the same time, it’s now clear that short-term cries of the end of PCs, and the rise of a permanent and exclusively post-PC market were wrong.

In January I wrote the following:

We need to keep close eyes on continuing declines in PC sales, but inside the next 8 quarters we could see a positive year-over-year period for PC sales. Something to think about.

According to Gartner, that was this quarter. I don’t think many expected to reach this point so quickly. If the market can match these results in the third quarter, we may have ourselves a trend.

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