Changewave Research: Dell Vs. HP PC Market Recap

ChangeWave Research: Dell vs. HP – PC Market Recap

Dell vs. Hewlett-Packard – PC Market Update

For the past 16 months, our Alliance surveys have tracked Dell’s (DELL) fall from grace amidst the ascendancy of archrival Hewlett-Packard (HPQ). But with Dell’s earnings report coming up on March 1st, this is a great time to summarize our most recent findings.

Below are the Dell and HP results from two recent Alliance surveys – a January 2007 consumer buying (n=2,341) and a February 2007 corporate purchasing survey (n=1,780).

I. Corporate PC Purchasing Trends

(A) HP Hangs In While Dell Continues To Slide

Our latest corporate PC purchasing survey (Feb 2007) shows slightly slower growth in store for the coming 2nd quarter. One-in-four respondents (25%) say their company isn’t planning to buy desktops in the 2nd Quarter – 1-pt worse than previously, while 23% say they’re not planning to buy laptops – 3-pts worse than previously.

How will this impact Dell and HP?

Hewlett-Packard’s market share for both desktop (18%) and laptop (15%) planned purchases in the 2nd Quarter has declined 1-pt, after having reached an all-time high in our previous corporate purchasing survey in November 2006.

Dell’s market share for both desktop (35%; down 3-pts) and laptop (34%; down 2-pts) planned purchases has continued to erode – hitting new all-time lows respectively for one of our ChangeWave Corporate PC purchasing surveys.

Bottom Line – Corporate PC Market. There are no signs yet of a Dell turnaround regarding corporate PC purchases. On the contrary, Dell’s share of planned corporate purchases continues to erode.

While 2nd Quarter visibility for HP looks a bit weaker (down; 1-pt), that appears to be a normal pause and of little long term concern – especially considering the huge burst of momentum HP experienced in our previous corporate PC buying survey (November 2007).

II. Consumer PC Buying Trends

(A) HP vs. Dell Among Consumers

Our most recent consumer buying survey (January 2007) shows Hewlett-Packard PC share continuing to improve in both laptops (22%; up 2-pts) and desktops (27%; up 1-pt).

Meanwhile in another bearish sign, Dell has fallen to record lows among consumer PC buyers of both laptops (28%; down 5-pts) and desktops (31%; down 10-pts).

(B) Future Planned Buying Trends

Going forward, Hewlett-Packard planned purchases for the next 90 days appear strong, with laptops (24%) up 1-pt and desktops (25%) up 3-pts.

The survey has some more bad news for Dell, whose share of planned laptop purchases (34%) fell 2-pts to the lowest level we’ve seen in an Alliance Consumer Spending survey.

On the bright side, however, Dell planned desktop purchases among consumers has increased to 44% – up 4-pts.

Bottom Line – Consumer PC Market. Hewlett-Packard clearly has momentum in the consumer market, reaching all-time highs in both desktop and laptop purchases over the past 90 days. HP also looks to improve going forward.

In contrast, Dell has fallen to all-time lows in terms of market share, and looks like it will continue to struggle in the laptop market going forward. The one upside, Dell does show momentum in terms of consumer desktop buying over the next 90 days.

This information is from ChangeWave Research, LLC and contains confidential business information.