Dell Secures Top Position in US PC Market as HP Shipments Drop Amid Rising Semiconductor Costs and Corporate Sector Growth
Dell took over from HP as the number one producer of PCs in the United States in the 1st quarter. The company established itself as the lead shipper of both desktop and laptop computers. This shift occurred even as the whole market was falling due to rising memory semiconductor prices and component shortages.
Only Dell was able to settle its shipment figure thanks to its brute force in the corporate PC market. According to market research company Omdia, Dell shipped 3,936,000 computers in the US during the 1st quarter. This volume gave them a 25% market share of the domestic market which is a volume increase of 1.1% compared to the same period in the last cycle.
While Dell saw a 2% gain in share, HP experienced a catastrophic drop. Their volumes fell 21.6% to 3,227,000 units which saw the company lose market share dropping from 24.3% to 20.5% and into 2nd place. The higher end of the domestic PC market was won by domestic and foreign big brands:
- Lenovo ranked 3rd with shipments of 3,146,000 units.
- Apple ranked 4th with shipments of 2,661,000 computers.
- Acer ranked 5th with 892,000 units delivered to clients.
During this time the whole PC market in the United States shrunk 7% year on year. Total shipments reached 15,751,000 units as supply chain bottlenecks continued to hamper manufacturing capacity.
The split between Dell and HP reflects that corporate buying remains stable while consumer spending is very volatile. The boom in consumer PC shipments collapsed 9.5% due to inflationary pressures and climbing component costs. In contrast the business buying sector only fell by 5%.
Budget PCs priced under 500 dollars crashed 18.7%. Dell used its intensive experience in the high value B2B sector to benefit from the continued upgrading needs of business customers. This strategy shielded the company from the collapse seen in the consumer market.
The bottom line for computer manufacturers is now primarily determined by the prices of internally sourced parts. Huge investment into AI infrastructure has concentrated semiconductor wafer supply toward enterprise servers and away from consumer equipment. This shift increased the price of common DRAM and NAND flash memory by over 700% and 800% respectively.
Omdia reports this 14 fold increase in supply cost has slashed profit margins for cheap laptops. Consequently this market segment has essentially been removed from the equation. Omdia expects US PC shipments to fall by 14.4% across the complete yearly cycle due to persistent memory scarcity.
Market watchers suggest that the inelasticity of memory components will continue into next year. The competitiveness of vendors will now hinge on their capacity to handle the supply chain effectively and accommodate the escalating price of components.
