PC market drops by over 10 percent as slump continues with no end in sight

Europe worst-performing region as shipments fall by 17 percent

Worldwide PC shipments dropped by 11 percent in the second quarter of 2013, from 85 million to 76 million, as tablets and mobile sales continue to erode demand and Windows 8 sales fail to materalise.

The figures from analyst house Gartner, are yet more doom and gloom for vendors such as HP and Dell, which have suffered for years since the introduction of devices like the iPad.

All vendors saw a decline in sales over the period, with Acer seeing a whopping 35 percent drop off. Lenovo only saw a 0.6 percent drop to 12.6 million shipments while HP dropped by 4.8 percent to 12.4 million. Lenovo still retained its worldwide market share crown from HP, with 16.7 percent of the market compared with 16.3 percent.

The drop is the fifth quarter in a row in which shipments have declined, marking the longest decline for the PC in its history.

Europe saw its second quarter of double-digit decline too. In European markets HP is the top firm with a 17.8 percent market share, while Lenovo is second with 12.4 percent. Overall shipments in the region were 21.2 million, down from 25 million, a decline of 16.8 percent. This was the worst performance for any region.

Isabelle Durand, principal research analyst at Gartner, said numerous factors were impacting the PC market in Europe.

"The sharp decline in the second quarter of 2013 was partly due to the shift in usage patterns away from notebooks to tablets, and partly because the PC market was exposed to inventory reductions in the channel due to the start of the transition to new Haswell-based products," she said.

"PC replacement rates continued to be extremely low, while the challenging economic environment is muting spending in consumer markets."

The figures match those from IHS, which said the market for notebooks and ultrabooks dropped by around 6.9 percent over the second quarter of the year, in the worst results from the market in some 11 years.

Victor Basta, managing director of merger and acquisitions advisory firm Magister Advisors, said the numbers proved the PC era is over and that those in the business of selling PCs should be worried.

"If you're a store chain called PC World you might want to rethink your brand quickly if you want to be associated with the future of technology rather than antiquity," he said.

"These numbers are also a huge cloud over the recent Dell deal, which now looks like a mega deal headed for zero returns."

However, the chief executive of Lenovo, Yang Yuanqing, was more upbeat, claiming there was the chance for more growth in the future.

"Even in the toughest PC market ever, Lenovo has not only gained share, but we have steadily improved profitability and introduced even more innovative products for every market segment," he said.

"The battle for PC leadership could certainly still go back and forth. But I am fully confident that there remains substantial room for profitable growth and groundbreaking innovation in the global PC marketplace."