Nicole Volpe and Peter Henderson
NEW YORK: Hewlett-Packard Co. pulled ahead of International Business Machines
Corp. to become the No. 3 personal computer maker worldwide in the third
quarter, market research firms said on Monday.
The two computer makers have been battling for the No. 3 spot since IBM
announced last year it was exiting the US consumer retail market, giving HP a
chance to close in. Hewlett-Packard seized the No. 3 spot in the first quarter
of this year, but IBM came back to tie for third place in the second quarter,
market research firm Dataquest said.
"They were really close last quarter," said International Data
Corp. analyst Loren Loverde. "But HP has been on a pretty aggressive growth
track. I think the momentum is behind HP this quarter."
HP shipped 2.6 million PCs in the third quarter - a rise of 40.2 per cent
over the year before, IDC said. IBM shipped 2.5 million PC units, up 8.3 per
cent from a year ago. HP had 7.8 per cent of the overall PC market, and IBM had
7.4 per cent.
Shares in HP rose $5-1/16 to $96 on Friday.
Dataquest, a unit of Gartner Group, also showed HP in third place globally,
with 38.6 per cent growth to 2.6 million PCs shipped.
Dataquest said worldwide personal computer shipments rose 15.2 per cent to
33.9 million units while IDC said the market grew to 33.3 million, an 18.3 per
cent increase.
The two firms measure the same market for desktop and portable computers, as
well as small servers, the central computers in networks. Their numbers vary
slightly because of different research methods.
"HP showed the largest increase in shipments among top-tier
vendors," the Dataquest report said. "It had continued success in the
US retail space taking advantage of the absence of IBM and Packard Bell."
IBM, the world's largest computer maker, pulled its PC business into
profitability for the first time in nearly a year in the third quarter, by
dropping out of the US consumer retail sales market.
Both IDC and Dataquest said IBM's share in the US market shrank in the third
quarter.
Global PC market leader Compaq Computer Corp. held onto its top position with
13.1 per cent of the total market. Executives from Dell Computer Corp. have said
they were on a path to steal the No. 1 position worldwide from Compaq, ever
since Dell unseated its Texas-based rival in 1999 as the No. 1 PC maker in the
US market.
"I think that would be optimistic," Loverde said when asked about
that happening in the near future. "There's still a good split."
Compaq shipped 4.4 million units worldwide in the third quarter, both
research firms said.
"Compaq grew units approximately 13-14 per cent, which we think is
good," Merrill Lynch analyst Steve Fortuna wrote in a note to clients.
"We remind investors that there are many other areas of business for Compaq
than desktops and notebooks."
Dataquest said that there were some expectations that the home market would
upgrade and replace old computers in the fourth quarter but that the corporate
market would wait until 2001. Thus the fourth quarter might not live up to the
third.
"We suspect these relatively strong numbers in the third quarter reflect
a buildup of channel inventory, and we do not believe the market can support the
kind of growth these numbers would indicate," he said. "The fourth
quarter could show slower unit growth."
However, Loverde said he was "cautiously optimistic" on the fourth
quarter, saying he did not see inventory levels at any level to cause alarm.
Compaq on Friday issued a statement saying it was comfortable with its
inventory levels.
(C) Reuters Limited 2000.