Apple 2.0

Covering the business that Steve Jobs built

PC pain is Apple's gain

September 8, 2010: 12:21 PM ET

The iPad is still picking up steam, says an analyst, cutting into sales of every PC but the Mac

Photo: Apple Inc.

Following up on a report issued Tuesday in which he cut his personal computer sales forecast for the second time in two months, Barclays Ben Reitzes took a closer look Wednesday at what it means for Apple (AAPL). In a note to clients, he writes:

"Given the BYOPC (buy your own) trend, international store growth and a halo effect from iPhone expansion, we continue to believe Apple can outgrow the PC market over the long-term even at premium prices. Note that Macs still only hold about 4% worldwide unit share. We remain confident in our [calendar Q3] Mac unit growth forecast of 23% y/y (+25% y/y for CY10) and we believe even these estimates could turn out to be conservative. Our checks indicate that Mac sales remain solid despite some slowdown in consumer markets with some support from new Mac products and continued international retail store rollouts. In addition, the iPad, which is not included in our PC unit model, has been very successful with 3.3 million units sold in C2Q despite limited availability. Our iPad unit estimate for C3Q is 4.3 million, which is likely very conservative given production yields have put supply/demand more in balance in September (after months of shortages) and international rollouts continue. We will continue to watch trends for the iPad closely, but to date we have not seen any indications of material cannibalization on Macs... We believe the PC players pain is Apple's gain."

In Tuesday's note, Reitzes cut his 2010 PC unit growth forecast to 16% from 19% and upped his 2010 tablet unit sales estimate to 15.85 million from 15.2 million. See here.

"Our contacts in Asia," he wrote, "seem to regularly blame the iPad for a large portion of the [PC] market woes."

UBS's Maynard Um has slightly different take, according to AppleInsider. "We are not sold that the iPad is purely cannibalizing PC sales, as the functionality of the iPad cannot yet deliver the functionality of notebook PCs," Um told clients Wednesday. "However, consumers who purchase iPads may be more willing to delay purchases and upgrades of existing PCs."

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[Follow Philip Elmer-DeWitt on Twitter @philiped]

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About This Author
Philip Elmer-Dewitt
Philip Elmer-DeWitt
Editor, Apple 2.0, Fortune

Philip Elmer-DeWitt has been following Apple since 1982, first for Time Magazine, and now on the Web for Fortune.com.

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