Lenovo expands market share as global PC shipments suffer

Firm extends lead in personal computer market but overall industry declines by record amount

PUBLISHED : Friday, 10 January, 2014, 2:15pm
UPDATED : Saturday, 11 January, 2014, 5:01am

Lenovo could set new record quarterly earnings after cementing its position as the world's biggest supplier of personal computers at the end of last year, while the overall industry suffered its worst-ever decline.

In separate preliminary estimates released yesterday, technology research firms IDC and Gartner said Lenovo seized its highest-ever quarterly market share of about 18 per cent in the three months to December.

IDC said Lenovo, which operates in more than 160 countries, grew its personal computer shipments by 9 per cent last quarter to 15.279 million units from the same period in 2012. Gartner calculated a 6.6 per cent increase to 14.932 million units.

For the full year, both firms saw Lenovo achieve a 17 per cent per cent global market share with total shipments of about 53 million units.

Alberto Moel, a senior analyst at Bernstein Research, said Lenovo's strong financial third quarter to December could see "US$241 million in earnings, which would be a new record, on the back of seasonal revenue growth and constant margins".

The computer giant reported in November a 36 per cent jump in net profit to a record US$219.7 million in its financial second quarter to September from the same period in 2012.

In a statement yesterday, Lenovo chairman and chief executive Yang Yuanqing said: "We have proven that there is room for growth, profit and innovation in PCs globally."

"I am confident Lenovo can continue to build on this momentum, outperform the market and become even stronger," Yang said.

In contrast, the overall PC industry suffered its seventh consecutive quarterly decline in the three months to December. IDC estimated a 5.6 per cent fall in shipments to 82.211 million units last quarter, while Gartner saw shipments drop 6.9 per cent to 82.633 million.

Both research firms calculated a record 10 per cent decrease in total shipments in the past 12 months to about 315 million units, reflecting greater demand for smartphones and media tablets, and lengthier delays for PC replacements.

Gartner analyst Mikako Kitagawa said: "In emerging markets, the first connected device for consumers is most likely a smartphone and their first computing device is a tablet."

Lenovo is familiar with the trend. The firm sold 14.6 million smartphones and media tablets in the three months to September, surpassing the 14 million PCs it sold in the same period.