What’s the current state of the PC business? Dell and HP, two of the biggest PC suppliers, just gave tech providers a glimpse. Both suppliers this week reported quarterly financial results that reveal how the PC market is changing.
For both vendors, PC sales are growing. But in HP’s case, that’s despite a drop in the number of unit shipments. And for Dell, the growth is only in systems for business and a few high-end consumers.
Dell’s PC business, known as the Client Solutions Group, had Q4 revenue of $10.9 billion, a year-on-year increase of 4%. For the full fiscal year, CSG revenue grew by an even stronger 10%, reaching $43.2 billion.
Yet look a bit closer, and a more complex picture emerges.
For the fourth quarter, Dell’s sales of consumer PCs actually declined by 6%, dropping to $3.1 billion. However, that was more than made up by a 9% rise in commercial PC revenue, hitting $7.8 billion.
Dell says it enjoyed double-digit revenue growth during the quarter in two main segments: commercial notebooks and workstations, and high-end consumer notebooks and displays.
So what’s it all mean for tech providers?
One, if you’re concerned about a decline in unit sales, take a lesson from HP and try raising your average selling price.
Two, take a lesson from Dell and steer clear of low-end consumer systems. The growth is elsewhere, most specifically business notebooks and gaming systems.
As these two suppliers show, your PC business can grow and be profitable — but only if done right. The market is changing, and what worked in the past may not work now or in the future.
So take some lessons from the big guns of the PC business, and prosper.