5/02/00 - Euro PC market slows down, Compaq and IBM suffer
By Richard Meares
cnbc.com
Hi Kemble! Michael sounded positive yesterday. My thought is that Europe is a known challenge and that it has been factored into their earnings. Still, I am sure that Michael is getting the team in place to see Europe grow...And think about China! :) What is your t-shirt going to say this year? :)Leigh
LONDON, May 2 (Reuters) - European personal computer sales grew more slowly than ever in January to March, with market leader Compaq (CPQ.N) and rival IBM (IBM.N) hit heaviest, latest figures showed on Tuesday.
Market research company Context said overall sales were only eight percent higher than a year earlier -- the lowest rise since the industry began.
Year on year sales grew 11 percent in the fourth quarter of last year and 18.5 percent the quarter before that.
Context revised down the 10 percent first quarter figure it gave last month, and said 7.4 million PCs were sold in the period.
It said consumers, encouraged by cheaper Internet access, made sure there was any growth at all, whilst a slowdown in big business continued.
"The figures for this quarter clearly indicate the European PC Market has not yet recovered from the slowing down effect of Y2K (the Millennium bug scare) on the corporate sector," said Context analyst, Inger Kwiatkowski.
She said healthy demand from small businesses and consumers was good news for vendors with a strong presence in those markets.
APRIL SHOWED NO SUDDEN PICK-UP
"We estimate the European PC market will grow 10 to 15 percent this year, and most probably at around 12 or 13 percent," she told Reuters.
"We don't think it will much above 10 percent for the next quarter. We have some figures in for April already and it does not look like things have suddenly been picking up."
Compaq Computer Corp sales in western Europe fell 8.5 percent but it stayed as the number one seller, shipping 1.1 million units compared to joint venture Fujitsu-Siemens' (6702.T)(SIEGn.DE) 832,000 and Dell's (DELL.O) 708,000.
International Business Machines Corp (IBM), heavy in the corporate market and the world's largest computer maker, saw sales slump 22 percent to 487,000, leaving it in fifth place behind Hewlett-Packard (HWP.N).
HP sales jumped 34 percent to just under 550,000.
NOTEBOOKS AND HOME USERS KEEP THE MARKET GROWING
Sixth-placed Toshiba's (6502.T) sales grew the fastest to 377,000 PCs -- almost 40 percent higher than a year earlier and a result of its market lead in the buoyant portable computer market.
Overall demand for corporate desktop PCs fell six percent but the market for notebooks grew 33 percent.
"The high growth rates for HP, Toshiba and Apple were largely fuelled by notebook demand," Context said.
Consumers bought 24 percent more computers than in the first three months of 1999.
"The outlook for the European consumer market for 2000 is positive," said Kwiatkowski.
"We expect this market segment to continue to grow at a healthy pace as increased affordability of Internet access in Europe is expected to increase demand for home PCs."
For full figures click on [nL02543569]
Rtr 11:17 05-02-00
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