China's Lenovo overtakes HP as world No 1 PC maker

PALO ALTO (CBS/AP) – Lenovo beat out rival Hewlett-Packard to become the No. 1 PC maker by a narrow margin, according to both firms.

In the Asia/Pacific (excluding Japan) region overall PC shipments in the region fell slightly below forecast due to China. Weak sell-in to China during April and May constrained shipments. Although June shipments in China improved, expectations for the third quarter are being lowered to reflect remaining inventory as well as economic pressures.

Worldwide shipments of personal computers fell 11 percent in the April-June period, according to data from research firms Gartner and IDC, as people continued to migrate to tablets and other mobile devices.

Gartner Inc. said Wednesday that the PC industry is now experiencing the longest decline in its history, as shipments dropped for the fifth consecutive quarter. Computer makers shipped 76 million PCs in the April-June period, down from 85 million in the same  three months of 2012, according to Gartner.

International Data Corp., which uses slightly different methodology, essentially came to the same conclusion, though it noted that the decline was slightly smaller than expected.

“With second quarter growth so close to forecast, we are still looking for some improvement in growth during the second half of the year,” said Jay Chou, senior analyst at IDC, in a statement. “Slower growth in Europe and China reflect the risks, while the improved U.S. outlook reflects potential improvement.”

Gartner’s Mikako Kitagawa said inexpensive tablets are displacing low-end computers in “mature” markets such as the United States. In emerging markets like China, meanwhile “inexpensive tablets have become the first computing device for many people, who at best are deferring the purchase of a PC. This is also accounting for the collapse of the mini notebook market,” she added.

IDC said the numbers “reflect a market that is still struggling with the transition to touch-based systems running Windows 8.”  Microsoft Corp.’s latest operating system launched in October and sales have disappointed analysts. But Kitagawa said that while “Windows 8 has been blamed by some as the reason for the PC market’s decline, we believe this is unfounded as it does not explain the sustained decline in PC shipments.”  - CBS, AP, AFP

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