Lenovo Takes Global PC Sales Lead

By Douglas A. McIntyre Published Apr 10, 6:28AM EDT

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PC sales may still be dropping, but that has not stopped China-based manufacturer Lenovo from increasing sales and stealing market share from competitors.

Lenovo shipped 12.9 million PCs in the first quarter, which gave it 16.9% of the world’s market. And its sales rose 10.9% from the first quarter of 2013. During the same period, industry sales dropped 1.7% to 76.6 million, according to tech research firm Gartner.

The two largest PC companies in the United States did fairly well, although both their sales growth rates and market shares were below Lenovo’s. Hewlett-Packard Co. (NYSE: HPQ) posted shipments of 12.2 million, up 4.1% from the third quarter of 2013. Dell, recently taken private, shipped 9.5 million PCs, or up 9%. Both companies are desperate for a rebound in the troubled industry — one that has put their earnings under siege since the start of a trend for consumers to use tablets and smartphones.

The future of Microsoft Corp.’s (NASDAQ: MSFT) Windows was among the forces that helped keep PC sales from dropping by double digits:

“The end of XP support by Microsoft on April 8 has played a role in the easing decline of PC shipments,” said Mikako Kitagawa, principal analyst at Gartner. “All regions indicated a positive effect since the end of XP support stimulated the PC refresh of XP systems. Professional desktops, in particular, showed strength in the quarter. Among key countries, Japan was greatly affected by the end of XP support, registering a 35 percent year-over-year increase in PC shipments. The growth was also boosted by sales tax change. We expect the impact of XP migration worldwide to continue throughout 2014.”

The problem with the news is that it is almost certainly not permanent. PC companies continue to battle for a rapidly shrinking market, which makes market share a flawed measure of success. Unit sales are a much more accurate measure of how manufacturers are faring.

For the time being, the only PC company that is faring very well is Lenovo. Even it will not be able to overcome the fact that more and more people do not want PCs at all.

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.