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More Evidence That Windows 8 Isn't Boosting PCs

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Following up on IDC's estimates on PC shipments in the fourth quarter, market researcher Gartner (NYSE: IT  ) has now put out its own figures on how poorly the broader PC market is faring. There's some disagreement between the two, but the consensus is that investors are still looking at a market in decline.

If you recall, Gartner figures show Hewlett-Packard (NYSE: HPQ  ) losing its crown as the top PC maker in the world by unit volumes in the third quarter, ceding that title to Lenovo after the latter slid ahead by just over 200,000 units. Following the third-quarter decline of 8.3% in global PC shipments as consumers and companies alike anxiously awaited the transition to Microsoft (NASDAQ: MSFT  ) Windows 8, the PC market just shrank a little bit more.

Sorry, PC
This time around, we're talking about a decline of 4.9% (versus IDC's negative 6.4% estimate). HP was able to retake its crown from Lenovo and become king of the PC hill just in time for the tablet market to bulldoze a hole through it. Dell's  (UNKNOWN: DELL.DL  )  shipments plunged by 20.9%, which is about what IDC also found.


Q4 2012 Worldwide Unit Shipments

Q4 2012 Worldwide Market Share

Growth (YOY)


14.6 million




14 million




9.2 million




8.6 million




37.4 million




90.4 million



Source: Gartner. Figures may not add up due to rounding. YOY = year over year.

In order to boost its market share, it's possible that HP sacrificed margins and the PC giant participated in the broad rollout of new Windows 8 devices. HP's personal systems group remains its biggest revenue generator, but also its lowest margin division, so the segment can't very well afford margin declines.

Echoing IDC's findings, Gartner says Windows 8 was unsuccessful in boosting overall PC volumes. The researcher said that PC OEMs were "lackluster" in their form factor designs and are mostly missing out on the potential in touch interfaces.

Domestic discrepancy
Gartner and IDC have some discrepancies when it comes to their respective domestic findings, particularly when it comes to Apple (NASDAQ: AAPL  ) . While IDC thinks Apple's U.S. Mac shipments were roughly flat in the fourth quarter at negative 0.2%, Gartner believes the Mac maker posted a 5.4% increase during the fourth quarter.


Q4 2012 U.S. Unit Shipments

Q4 2012 U.S. Market Share

Growth (YOY)


4.7 million




3.4 million




2.1 million




1.5 million




1.4 million




4.5 million




17.5 million



Source: Gartner. Figures may not add up due to rounding. YOY = year over year.

The difference in domestic Mac estimates is a little more than 100,000 units in absolute terms, which isn't going to make or break the company's fourth-quarter results. Either way you slice it, though, Apple is continuing its streak of outperforming the broader PC market every quarter, a stat that Tim Cook likes to boast.

I've heard this one before
Naturally, the big culprit here continues to be tablet adoption as consumers shift media consumption to those devices in what Gartner refers to as a "structural shift." Instead of a reliable upgrade cycle, consumers are now likely to allow secondary PCs to become obsolete while shifting spending patterns to tablets.

The lines between different device categories continue to blend though, as Windows 8 takes on a plethora of shapes and sizes. Microsoft's whole goal with Windows 8 is to ambitiously offer a platform for all devices, and only time will tell if this is too much to ask.

Tablets continue to be predominantly consumption devices, but Gartner doesn't see that as a problem for their prospects. Some users will always need productivity machines, but an increasing proportion of consumers' casual tasks can be performed by tablets while shared PCs may be used to get some real work done.

It's been a frustrating path for Microsoft investors, who've watched the company fail to capitalize on the incredible growth in mobile over the past decade. However, with the release of its own tablet, along with the widely anticipated Windows 8 operating system, the company is looking to make a splash in this booming market. In this brand-new premium report on Microsoft, our analyst explains that while the opportunity is huge, the challenges are many. He's also providing regular updates as key events occur, so make sure to claim a copy of this report now by clicking here.


Read/Post Comments (6) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On January 15, 2013, at 9:48 PM, Netteligent09 wrote:

    Nobody wants to spend money to upgrade to Microsoft Windows 8.

    Apple is nice enough to give free iOS upgrade from iPhone, iPAD, etc.

    Either way you slice it, Microsoft is more buggy, boring, and expensive.

    Ultralaptop and Microsoft RT are another huge failures. If you do not learn from your past mistakes, most likely you do it again.

  • Report this Comment On January 15, 2013, at 10:36 PM, eldernorm wrote:

    Cool heat, with Apple selling more and more units of every type and making more profit than anyone else in the world, just why do you think people are leaving Apple?

    Or are you just trolling for Samdung or such?

    Ps. If you look at the world PCM sales and backout Apple sales, the losses look even worse.. Funny math does not make a funny world.

    Just a thought.


  • Report this Comment On January 15, 2013, at 10:43 PM, checkessential wrote:

    Netteligent09, I have an ipad and an Acer V5 touchpad running W8. Anyone who says W8 is a huge failure has not used it. Ipad is a good reading device. Windows 8 is the real deal.

  • Report this Comment On January 15, 2013, at 11:18 PM, techy46 wrote:

    Wow, these guys just keep hyping the slowdown in PC sales between Windows 7 and 8 refresh cycles when W8 just released and everybody's waiting for the W8 Pro devices, Intel Atom Z2760 and iCore, to ship in volume and prices go down. Sure, 90m is down but add in 4-10m tablets and 4-10m smart phones per quarter and pretty soon you're back to 100m W8 and W7 devices shipping each quarter. Enough already, go figure out whu you Apple's are falling iff the tree onto the ground.

  • Report this Comment On January 15, 2013, at 11:30 PM, deasystems wrote:

    @techy46: Looking at your last sentence, I now completely understand why one shouldn't post when drunk.

  • Report this Comment On January 15, 2013, at 11:31 PM, deasystems wrote:

    @coolheat2: Why add a comment to an article you clearly have not read?

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