February 12, 2004 1:09 PM PST

PC shipments to rise in 2004, says Gartner

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Happy days are here again for PC makers, at least according to one market researcher.

In its 2004 forecast, released Thursday, Gartner predicts that strong sales to consumers, along with increases in business purchases, will boost worldwide PC shipments by nearly 14 percent this year. The company said PC shipments will reach 187 million units in 2004, representing a 13.9 percent increase from 2003.

Higher unit sales are also expected to produce a gain of about 9.5 percent in worldwide PC revenue, for a total of about $213 billion, Gartner predicts, even though average PC prices are expected to continue to decline by about 4.5 percent, said George Shiffler, principal analyst for computing platforms and economics research at the company.

"Basically, our view is that 2004 is going to be a pretty good year," Shiffler said, "because we think this replacement cycle is under way. We think this is going to power growth this year and into next year."

Two main factors produced Gartner's positive forecast, Shiffler said. First, consumers continue to buy new computers--with some people upgrading to new desktops to handle budding interests in digital photography or multimedia, and others making the switching to notebook PCs. Meanwhile, businesses in the United States and Europe have slowly started buying PCs again.

Gartner has also observed that Western European businesses have started replacing PCs, while consumer sales there have also picked up, thanks in part to the strong position of the Euro, Shiffler said.

Some uncertainty remains among businesses in the United States, however.

"There are still some business confidence issues, and there are certainly some employment issues that are going on that may hang things in the first quarter in the United States," Shiffler said. But "as the year progresses, we think the United States will gain more strength."

As a result, Gartner forecasts that worldwide unit shipments will jump 13.3 percent year over year in the first quarter, reaching 44 million. The second quarter could see a bump in sales as well, as U.S. consumers begin receiving tax refunds.

"There's some room for some upside surprise in the second quarter," Shiffler said.

Meanwhile, if shipments do hit the 187 million unit mark in 2004, they'll set a new record. Shipments equaled 164.2 million units during 2003, a new high versus shipments of 148.2 million units in 2002, Shiffler said.

Rival researcher IDC's latest forecast predicts that worldwide PC shipments will increase by 11.4 percent to 170 million in 2004, said Roger Kay, an analyst with the firm.

IDC will likely release its official 2004 forecast in March, Kay said.

Gartner's and IDC's forecasts differ because the two companies use slightly different methods for measuring unit shipments.

 

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