IDC drops PC forecasts

Although PC shipments actually beat expectations in the first quarter, a gloomy economic outlook has prompted market research firm IDC to lower its PC forecast for 2003 and 2004.

The research firm said on Monday that it now expects total worldwide shipments of desktops, notebooks and servers containing Intel or AMD chips to reach 145.2 million in 2003, a rise of 6.3 per cent over the previous year's tally. Earlier this year, IDC predicted that such shipments would grow by 6.9 per cent.

IDC also lowered its forecast for 2004 shipments, which are now expected to increase by 10.3 percent, rather than by 10.9 percent.

At the same time, the aggregate value of PC shipments this year is expected to decline 2.4 per cent, but that looks likely to be followed by growth of 3.5 per cent in 2004. Previously, IDC had expected revenue from shipments to fall 1.8 per cent in 2003 and rise 2.9 per cent the year after that.

Loren Loverde, director of IDC's PC tracking service, said in a statement: "PC demand remains limited, despite improvements from last year. We've seen only limited recovery in business shipments, while consumer growth has slowed in recent quarters, and public sector shipments are falling. Growing consumer and business confidence, as well as system replacements, will boost growth in the second half of the year, but we won't see double digit growth until 2004."

Demand in the Asia-Pacific region and in North America will continue to drive the PC market, while Europe and Japan will limp along. The US market was actually stronger than expected because of public sector buying, IDC said.

Rival research company Gartner Dataquest issued a similar forecast in May. The firm upped its second-quarter forecast to 6.4 percent, but slightly lowered its forecast for the entire year, to 6.6 per cent.

But both firms are predicting growth in the range of six per cent, which would represent a marked improvement over 2002, when PC shipments increased by 1.5 per cent. In 2001, PC shipments shrank for the first time in over a decade.

Michael Kanellos writes for News.com