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Dismal PC business contraction continues; no bounce yet from Windows 10

Dismal PC business contraction continues; no bounce yet from Windows 10

Mac sales may also shrink, says IDC, though Gartner disagrees

As expected, Windows 10 provided little if any bounce to PC shipments in the just-concluded September quarter, researchers at IDC and Gartner said yesterday.

"Not in terms of driving volume, no," said Loren Loverde of IDC in a Friday interview when asked about Windows 10's impact. "The main inhibiting concern has been the continuing free upgrade."

Rival research firm Gartner concurred. "The focus of the Windows launch in the quarter was to upgrade to Windows 10 on existing PCs, rather than ship on new PCs," the company said in a statement.

Both IDC and Gartner pegged third-quarter PC shipments as down from the same period in 2014, although they differed slightly on the extent of the contraction. IDC said that shipments declined 11% year-over-year, while Gartner said it was closer to 8%. IDC put shipments at 71 million, Gartner, at 74 million. Part of the difference is how each defines the category: IDC does not include tablets with detachable keyboards, such as Microsoft's Surface Pro, while Gartner does.

According to IDC, the top three OEMs (original equipment manufacturers) -- Lenovo, HP and Dell -- saw shipments decline by 5%, 6% and 3%, respectively. Gartner forecast shipment decays of 4% for Lenovo and HP, with a half-point increase for Dell.

If IDC's forecast proves accurate, it would be the fourth-worst quarter for PC makers since the research company and its analysts began tracking shipments in 1996.

IDC and Gartner agreed that Windows 10 did nothing for the industry in the September quarter, as Microsoft's attention was on getting the free upgrade into current customers' hands, and OEMs (original equipment manufacturers) were unable to fully flesh out their portfolios with new devices during the stretch -- in part, because of the short span between Microsoft handing Windows 10 to its partners and the public launch.

The fourth quarter may be different.

"The Windows 10 rollout will ramp up in 4Q15 holiday sales," said Gartner, reflecting reality, which has seen new device introductions by Microsoft, Dell and Hewlett-Packard in the last few days, with other OEMs to follow shortly.

But even if fourth-quarter shipments get a boost from Windows 10 -- something Loverde said was possible as new designs like Microsoft's Surface Book go on sale -- there's no chance that the numbers will be enough to stem the continued slide of the personal computer industry for the year. IDC, for example, currently projects a 9% reduction in 2015, although that number did not reflect the third quarter's dismal results, hinting at an eventual larger-than-expected contraction for the year.

In other words, there's no chance of a turn-around in the business's 15-quarters-and-counting decline until 2017 at the earliest.

Meanwhile, although both IDC and Gartner forecast that Apple's share of the personal computer market increased in the September quarter over the same period in 2014, they disagreed about whether the Cupertino, Calif. company would match unit shipments of last year.

IDC predicted that Apple shipped 5.3 million Macs in the quarter for a 7.5% share of the PC total, up from 2014's 6.9% share. Gartner's estimate had Apple with a shipment of 5.6 million Macs, or 7.6% of the total, also up from last year's 6.9%.

With Apple stating last year that it sold 5.5 million Macs, IDC's projection would mean a 3.4% year-over-year decline, an unusual spot for Apple, which has grown Mac sales for seven consecutive quarters even as the rest of the industry shrunk. The last time Mac sales contracted was the September quarter of 2013, the final quarter of a four-quarter downturn.

Gartner was a bit more optimistic about Mac shipments, betting on 5.6 million, a 1.5% bump over 2014.

Loverde admitted that forecasting Mac shipments is tough. "There's a significant margin of error in our Mac numbers," Loverde said, citing Apple's secrecy -- and the closed mouths of its suppliers -- that make predictions more difficult than for many Windows PC OEMs. "To be frank, there's a limited amount of information out there [about Mac sales]," Loverde added.

For example, last year at this time IDC underestimated third-quarter 2014 Mac sales by about 11%. If its margin of error was similar this year, it would put Apple up 7% for the period with shipments around 5.9 million.

IDC had Apple in the fourth OEM spot in global shipments for the quarter -- behind behemoths Lenovo, HP and Dell, each which ships about twice the number of personal computers as does Apple -- moving Apple up one place from this time last year. Gartner also listed Apple in the fourth spot.

Apple will disclose its third-quarter Mac sales on Tuesday, Oct. 27, prior to its 2 p.m. PT conference call with Wall Street to discuss earnings.

PC shipments from IDC Data: IDC

PC shipments declined again in the September quarter, dropping nearly 11% as an unprecedented 15-quarter contraction continued. Windows 10 provided little if any bounce to shipments, as Microsoft focused on getting the free upgrade into users' hands. 

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