Don't blame us!
Excerpt from today's Financial Times:
Europe not to blame for Dell's personal computer woes
The chorus of computer hardware makers blaming weak demand in Europe for their softening results is way off-key, according to analysts.
In recent days, Dell and Intel have blamed the continent for warnings of lower than expected earnings.
Dell warned that revenue growth for the year would fall short of its 30 per cent target. Intel said third quarter revenue growth would be below forecasts, rising only 3-5 per cent from the second quarter's $8.3bn, instead of the expected 9-10 per cent.
However, analysts report a healthy demand for PCs in Europe, with predicted growth rates for this year of 11-13 per cent, albeit below last year's exceptional 23 per cent.
Howard Seabrook, vice-president and director of services at the Gartner Group market research firm, which tracks PC sales, said: "I am surprised at Dell's and Intel's statements. We have not seen substantial weakness in the PC market."
Gartner Group forecasts that the European PC market will grow by 11-12 per cent this year. Companies looking to higher growth were being unrealistic, Mr Seabrook suggested, as it had long been expected that growth rates would flatten year-on-year following strong rises between 1998 and 1999.
"Last year was a bumper year as many companies upgraded systems in anticipation of the year 2000 problem," he said.
His remarks were supported by Andrew Brown, analyst at market researcher IDC, who forecast growth of nearly 13 per cent this year.
"The small to medium business sector is still healthy, the consumer market is very healthy and notebooks are booming. Growth in the corporate desktop market has been in single digits for the first two quarters, but we expect this to pick up in the fourth quarter," Mr Brown said.
Full article:
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