EMEA PC Shipment Growth Saved by Holiday Season Promotions, Says IDC

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PC shipments in Europe, the Middle East, and Africa (EMEA) reached 25.5 million units in the fourth quarter of 2014 - a 2.0% increase year on year, according to International Data Corporation (IDC). Strong consumer demand during the holiday season helped keep the market at positive levels for the third consecutive quarter, albeit modest and patchy across the region, leading to 5.5% growth for 2014 with 93.3 million PCs shipped in EMEA.

Once again, there were strong regional differences in EMEA. Western Europe continued to drive growth with shipments increasing 10.7%. In line with expectations, Central and Eastern Europe contracted 18.7%. The Middle East and Africa (MEA) grew 2.6%. The market was primarily driven by healthy consumer shipments in Western Europe. Vendors continued to stock up ahead of Christmas and January promotion sales, and before the February change to Bing promotions in mature markets excluding 15in. notebooks. This resulted in portable PC shipments increasing 5.3% year on year in EMEA. As expected, desktop PC shipments contracted 3.5% during the quarter. Currency fluctuations have also had a strong impact in northern Europe, Russia, and other countries in Central and Eastern Europe, the Middle East, and Africa (CEMA), while an unstable political situation and macroeconomic weaknesses continued to inhibit investments in parts of the region. The dynamics across EMEA reflect a strong need for renewals in the mature markets, while highlighting that emerging economies continue to struggle.

"The growth in Europe is a positive sign for manufacturers. Past quarters saw consolidation in the market with HP and Lenovo emerging stronger than before," said Chrystelle Labesque, research manager, IDC EMEA Personal Computing.

In Western Europe, shipments for the holiday season and post-Christmas promotions underpinned the growth particularly in the consumer space. Central Europe did not see any major uplift, whereas France and the U.K. showed solid double-digit percentage growth. Southern Europe (Spain, Greece, Portugal, and Italy) has been on a recovery path after years of decline. Promotions have been key to driving demand and boosting consumer portable PC shipments by 18.2% and consumer desktops by 13.2%. The positive impact of the end of Windows XP support on desktops ended, which explained the 3.9% decline in commercial shipments. In addition, pockets of inventory across the region led to a further drop in sell-in of business desktops. As expected, commercial demand remained strong for portable PCs, which posted a 12.6% increase. Overall desktop shipment growth in Western Europe reached 1.6% and portable PCs 15.9%.

"PC manufacturers prepared very attractive consumer offers this Christmas, with low price points supported by Windows 8.1 with Bing edition, which enticed end users to renew their devices," said Maciek Gornicki, senior research analyst, IDC EMEA Personal Computing. "With the conditions of the promotion about to change, inventories have been built up this quarter, contributing further to higher levels of stock in the supply chain, which might translate into deceleration in consumer shipments in the first half of 2015. In the commercial segment, the wave of desktop renewals following the end of Windows XP support ended abruptly, while refreshes of portable PCs related to the introduction of Windows 7 four years ago continued and kept the commercial portable market healthy."

Stefania Lorenz, associate VP, IDC CEMA, said 2014 ended with the PC market in the CEE region contracting 14% year on year as 4Q followed the trends witnessed in the previous quarters, reporting an annual decrease of 18.7%. "For the second consecutive year the CEE region contracted by double-digit units," she said. "2014 was affected mostly by the events in the eastern part of the region. Devaluation of the currencies in Russia, Ukraine, and Kazakhstan has had the biggest impact on purchasing power. All other countries in the region reported healthy demand for the full year with double-digit growth."

"The PC market in Central Europe reported overall year-on-year growth of 7.9% in 4Q driven by portable PCs," said Nikolina Jurisic, product manager, IDC CEMA. "Demand in the consumer space was driven by the continually attractive prices offered by MS Windows 8.1 plus Bing. The commercial sector recorded even stronger year-on-year growth as there is a clear need to replace the outdated installed base in addition to updates from XP operating systems. The MEA region recorded positive growth of 2.6% year on year, thanks to the stronger demand witnessed in Turkey and Saudi Arabia. While Saudi Arabia recovers after the introduction of a new labor law in 2013 that had negatively affected the market, expected changes in the import-tax law in Turkey at the beginning of 2015 have certainly contributed to additional electronic products being shipped into the country."

Vendor Highlights

The top 3 players in EMEA account for more than half of the market and the top 5 for more than 70% following strategic decisions by Samsung and Sony to further invest in the region.

- HP outperformed the market and consolidated its share at more than 23% in EMEA. The vendor made strong gains particularly in the portable PC area with solid 29% growth, taking the lead in both product categories, despite a small contraction in desktop shipments. New products like Stream and convertibles were very prominent during the holiday season promotions.

- Lenovo maintained the strongest growth among the top players, continuously beating market expectations across EMEA and reaching almost 20% share in 4Q. It saw very significant growth in southern Europe (Italy, Spain, Greece, and Portugal).

- Dell grew faster than the market and consequently gained shares in EMEA. The vendor performed well in portable PCs and particularly in CEE. A consistent and strong strategy execution supported this.

- Acer recorded a softer performance, in part due to an unfavorable year-on-year comparison. Results in Western Europe were better than in the other subregions. Desktop shipments grew slightly while the vendor increased its focus on tablets.

- ASUS continued to grow aggressively in the desktop market, albeit from a small base, while the success in the tablet market seems to have come at the expense of portable PC shipments, which contracted slightly.

Outside the top 5 vendors, Apple ranked sixth, benefiting from stronger consumer demand. Toshiba's stronger focus on the commercial market explains why it did not fully leverage consumer trends. Fujitsu's focus on commercial led to a decline due to the slowdown in the overall business segment. MSI was in ninth place and Wortmann was 10th.

Source: IDC EMEA Quarterly PC Tracker, Preliminary Results, 4Q14, January 2015

* PC shipments = desktops and notebooks

Top 5 EMEA PC Vendors, Unit Market Share, Q414 (Preliminary)

Shipments are branded shipments for all form factors (including desktops and notebooks) and exclude x86 servers as well as OEM sales for all vendors. Data for all vendors is reported for calendar periods.

For more information on IDC's EMEA Quarterly PC Tracker or other IDC personal computing research services, contact Associate Vice President Karine Paoli on +44 (0) 20 8987 7218 or at kpaoli@idc.com. Alternatively, contact your local IDC office or visit www.idc.com.
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