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Why Is HP Optimistic about Long-Term Growth in Personal Systems?

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Feb. 27 2018, Updated 5:50 p.m. ET

HP continues to lead the worldwide PC market

In the previous part of this series, we saw that HP’s (HPQ) Personal Systems revenue rose 15% YoY (year-over-year) in fiscal 1Q18. While total units rose 7% YoY, notebook shipments rose 8%, and desktop shipments rose 6% YoY in 1Q18. HP continued to lead the global PC market with a share of 23.5% at the end of 4Q17, according to market research firm IDC.

The other top players include China’s (FXI) Lenovo (LNVGY), Dell, Apple, ASUS, and Acer (ACEYY) with shares of 22.2%, 15.7%, 8.2%, 6.4%, and 6.4%, respectively. IDC has estimated a rise of 8.3% YoY for HP’s shipments, much higher than the global rise of 0.7%.

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HP CEO Dion Weisler stated, “Our focus on providing incredible experiences to our partners and customers contributed to market share gains. In calendar quarter four, the PC market grew both in units and revenue. We outpaced the market growth in every region, extending our number one unit market share to 23.5%, up 1.7 points year-over-year.”

Premium gaming market

According to a report by the Telegraph, HP’s Omen 15 is one of the best premium gaming laptops. This product is priced at 799 pounds and has a battery life of five hours. It is one of the least expensive products in the premium gaming space. Other products include the MSI GP72 priced at 820 pounds, the Dell Inspiron Gaming at 929.99 pounds, the Alienware at 1,529 pounds, and the ASUS ROG Strix GL502VS at 1,699.99 pounds.

HP had a negligible presence in the gaming market in 2015. However, since the gaming space is one of the fastest-growing segments, HP has invested in this high margin product. According to DigiTimes, more than 4.5 million gaming laptops were sold in 2016.

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