HP, Dell still dominate a booming global PC market; bad news lurks for AMD

October 18, 2007: 9:52 AM ET
Photo: HP

Global PC sales are growing at their fastest clip in two years, and Hewlett-Packard (HPQ) and Dell (DELL) are getting most of the action.

According to figures released by IDC on Wednesday, the two dominant PC makers made one of every three computers sold worldwide in the summer quarter, and one of every two sold domestically. HP remained the leading PC manufacturer, but Dell seemed to be recovering from recent stumbles.

In every region, PC growth was driven by hunger for laptops that allow people to use computing power without being tethered to a desk. IDC said that while both desktop and laptop sales grew in Europe, laptop growth was much stronger. Laptops also surged in Asia. In the U.S., desktop sales declined as laptops gained.

These trends are defining how PC industry players position themselves for the future. HP has highlighted mobile technologies as the key area where it will invest its research resources in the coming years to grow its PC revenues. Dell has a renewed focus on mobility as well, having recently announced laptops that use a combination of hard disks and flash memory for storage. And Apple (AAPL) for the past several years has said that mobile computing will be the focus of its innovation – that direction helped the company widen its lead over Toshiba to hold onto its position as the third-largest seller of PCs in the U.S.

The trends do not bode well for everyone in the industry, however. Advanced Micro Devices (AMD), which has been trying to grab market share from dominant rival Intel (INTC), is likely having a particularly hard time. That's because Intel's laptop chips are widely recognized in the industry as being technologically superior to AMD's. Also, PC buyers outside the U.S. tend to be extra-loyal to Intel's brand.

Those were among the trends that helped Intel post results for its summer quarter that beat analyst estimates. Revenues and profit margins were strong, and Intel gave optimistic projections for the holiday quarter.

The IDC numbers:

IDC global PC sales, Q3 2007
IDC worldwide PC sales, Q3 2007
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IDC U.S. PC sales, Q3 2007
IDC U.S. PC sales, Q3 2007
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