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The King Is Dead: HP Loses the PC Crown to Lenovo

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It's that time of year again. With June now in the rearview mirror, market researchers Gartner and IDC have now released their respective estimates on PC unit shipments in the second quarter, which will subsequently be followed by their digits on the smartphone and tablet markets.

The two companies may use different methodologies and have slightly different figures, but they agree on one thing: Hewlett-Packard (NYSE: HPQ  ) is no longer the top PC vendor in the world by unit volumes. That title has now been transferred to Chinese OEM Lenovo. All 5 of the top vendors declined; Lenovo just declined the least.

Dell (UNKNOWN: DELL.DL  ) remains the No. 3 player, but still lags its domestic rival by a fair amount. IDC says Dell's enterprise PC segment performed well, thanks in part to a transition within the enterprise from Windows XP to Windows 7. That's a shift that HP is looking forward to as well.


Q2 2013 Shipments

Q2 2013 Market Share

Growth (YOY)


12.6 million




12.4 million




9.2 million




6.2 million




4.6 million



Total Market

75.6 million



Source: IDC. YOY = year over year.

Acer and ASUS got hit particularly hard, with year-over-year drops well into the double digits. Both OEMs have historically enjoyed strong positions in the low end, which is being eaten alive by tablets. Their high-end Ultrabooks aren't picking up the slack.

The overall market remains soft, with worldwide shipments falling 11.4% to 75.6 million, according to IDC. That's a sequential improvement from the 14% drop that the market saw in the first quarter. IDC was quick to blame Microsoft (NASDAQ: MSFT  ) Windows 8 for the weakness in Q1, saying it was "clear" that the new platform "slowed the market." IDC still thinks that the market is "struggling with the transition," but a wider range of Windows 8 models in the U.S. definitely helped this time around as OEMs test different form factors.

Gartner, on the other hand, disagrees. The researcher thinks blaming Windows 8 is "unfounded," since it doesn't properly explain the PC's sustained decline, nor does it explain Apple's performance.

This actually isn't the first time that HP has lost the crown to Lenovo. In Q3 2012, Gartner said Lenovo had come out on top, but IDC still pegged HP as the No. 1 vendor, as the two researchers had slightly different estimates. This time, there's now consensus that HP is no longer the PC king.

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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 July 12, 2013, at 11:34 AM, dilfarb wrote:

    And what were HP's and Lenovo's respective profit margins for the PCs they sold? Lenovo bought market share by barely breaking even; that's not sustainable.

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