- Tablets? Competition? Economy? Neglect?
It could be tablets, the economy, neglect or competition, but something is causing a decline in PC sales to consumers at Dell and HP, probably Acer too. The PC market has clearly split into two camps: consumers and the corporates.
HP reported that total PC sales in the fiscal quarter ending April 30 fell 5%, including a 23% in sales to consumers and despite a 13% increase in sales to businesses.
HP CEO Leo Apotheker called the PC market “bifurcated” during a conference call with analysts. He said, “Even though our consumer PC expectations had been cautious, the steepness of our Q2 decline is greater than what we had anticipated.”
In the meantime, of course, consumer purchases of tablets have soared. HP does not even have a tablet on the market yet and Dell’s is a run-of-the-mill Android tablet.
Dell said its sales to businesses in its quarter more than replaced its decline in sales to consumers. Sales to the corporates increased 5%, but its sales to consumers declined 7%.
Dell CFO Brian Gladden said sales to consumers were weaker than expected. The consumer market only accounts for 20% of Dell’s revenue, so perhaps it needs a tablet that’s suited to the corporates like one that uses Windows, if and when a tablet-friendly version of Windows arrives. In the meantime, the corporates have begun buying iPads.
Perhaps the bifurcation is greater than HP’s Apotheker thinks with the entire consumer business moving to Apple, whose success with its Apple retail stores has been far greater than many expected, including us.
Or, the PC makers can keep blaming the decline in sales on consumers or the decline in the economy. In either case, they should notice that at Apple they are booming.
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