1Q PC Shipments Rose; Weak Dollar Credited1Q PC Shipments Rose; Weak Dollar Credited

PC shipments hit double digit growth in the first quarter slightly countering the spate of disappointing earnings from technology companies. IDC reported Friday that PC shipments rose 10.9 percent--about 1 percent over its forecast—year-over-year in the quarter.

Giving impetus to the increase were strong performances in the European, Middle Eastern, and African (EMEA) markets and were driven largely by a weak dollar, said Loren Loverde, director of IDC's Worldwide Quarterly PCTracker. "The weak dollar fuels some growth," he said. "The weaker dollar particularly facilitates consumer purchases abroad."

In spite of the strong shipments results, Loverde said there may be some faint signs that the corporate PC market could slow. "Dell's and IBM's business were not as strong as they could have been," he said. "There [are] some expectations now that corporate PC sales could slow."

Dell and IBM PCs sell well in the corporate PC market, but IBM's financials, announced Thursday, surprised Wall Street with numbers below expectations.

Even so, the PC numbers were relatively robust. Most firms, with the exception of Gateway, reported strong shipments. Gateway shipments for the first quarter declined more than 20 percent year-on-year, as the firm struggled to digest the acquisition of eMachines.

"First quarter results demonstrate that demand remains healthy going into the new year," said Loverde. "Although the market is expected to slow later this year, demand for portables, system replacements, and growth in emerging geographies continue to drive expansion."

While EMEA markets remained strong with growth better than 15 percent, IDC found that U.S. growth was also strong, driven by portable PC shipments and growth in small- and medium-sized businesses.

Dell remained the top shipper, nailing down a 34 percent share of the PC market compared to Hewlett-Packard's 18.2 percent share. Loverde noted that both Dell and HP maintained steady gains in the first quarter. The other major providers including IBM and Toshiba also grew during that period.

Taking note of the former seesaw struggle between Dell and HP, Loverde observed that the two firms changed lead positions in 2002 and 2003, although Dell has held onto the first place position throughout 2004 and into 2005. HP recently hired a new chief executive and the firm has been buffeted with rumors that it will spin off its PC unit, which it bolstered a few years ago by its acquisition of Compaq Computer.

Noting that Apple Computer logged a strong 43 percent growth in the quarter, IDC said the firm was benefiting from leveraging its success with its iPod and Mac mini. Apple's PC shipments were up 43 percent, IDC added.