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Global PC Shipments Better than Expected

As in the first quarter of 2009, global PC shipments again came in slightly ahead of expectations in the second quarter (2Q09), lessening fears over the extent of the PC market slump.

Worldwide PC shipments (including Desktop and Portable PCs, but excluding x86 Servers) were down 3.1 percent from the second quarter of 2008 -- a notable improvement over an expected decline of 6.3 percent, according to a market study by IDC.

All regions either met or surpassed expectations. Although the global downturn is still making its effects felt in the PC industry, the slump has been mitigated by a PC market which has seen the computing experience evolve to be more personal, portable, and cost-oriented rather than performance-driven.

Portable PCs continue to be the primary driver of volume and growth with all regions seeing strong Portable shipments.

"These results are a very positive indicator for the second half of the year," said Loren Loverde, program director for IDC's Tracker Program.

"We are seeing continued demand from consumers and limited impact from supply chain factors such as inventory balancing. New product launches in the second half of the year combined with seasonal growth and greater economic confidence resulting from factors such as government stimulus, a more liquid housing market, relatively stable stock market and interest rates, and progress in the auto and financial industries, should support the expected return to growth by year-end."

While the market has outperformed expectations for a second consecutive quarter, the lack of commercial activity remains a drag on growth. The business user segment remains more conservative with spending, focusing on other priorities and preserving cash.

As a result, the segment has not been as motivated by falling prices and new portable designs as the consumer segment.

Despite continued contraction from a year ago, the U.S. market managed a better-than-average sequential performance -- an indication of a stabilizing or improving market.

While the sequential growth may be a hint of recovery, the market's focus on lower-price PCs and Mini Notebooks is likely to drag the value of the market to lower levels. The market continues to rely on consumer purchases, with a substantial weakness in the commercial space.

IDC expects to see more of the same as we enter the busy shopping season of the second half of the year. In the longer term, an expected recovery in the commercial segment should boost growth in 2011.

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