HP, Dell Challenge Lenovo's Worldwide Dominance In The Incredible, Shrinking PC Market

Reaching A 10-Year Low

The PC market receded to its lowest level in a decade in the first quarter, shutting out smaller vendors and pitting the industry's largest players – Dell, HP Inc. and Lenovo – against one other in an all-out battle for supremacy in the commercial sector.

The global PC market contracted again in the first quarter as shipments declined 2.4 percent year-over-year to 62.2 million units, according to research firm Gartner Inc. This is the first time the global PC market has seen shipments of less than 63 million units since 2007. The decline was driven by weak demand, as well as price increases in response to memory and SSD shortages.

Gartner expects the consumer PC market to continue to shrink, which means it will be critical for vendors to grow in the commercial PC market. Business customers are the key to growth, and ultimately, survival, Gartner said.

Here are five keys to the Q1 PC market.

Lenovo Still The Global Leader, But Eked Out A Small Gain

Lenovo, the Beijing, China-based PC powerhouse continued to lead the worldwide PC market, shipping 12.4 million units during the quarter and commanding a 19.9 percent share of the market, according to Gartner. However, that total represents year-over-year growth of just 1.2 percent and locks Lenovo into an intense battle for market supremacy with HP Inc.

HP Inc. In Growth Mode, Threatens Lenovo's Worldwide Dominance

HP Inc. was the biggest gainer in the global PC market during the quarter, shipping 12.1 million units, notching 6.5 percent growth and controlling 19.5 percent of the market, Gartner said. And while HP is clearly threatening Lenovo, it is also being threatened by the world's third-biggest PC player, Dell.

Dell Posts Shipment, Share Gains With HP In Its Sights

Dell's PC global PC business grew 3.4 percent in the quarter, shipping 9.4 million units and controlling 15 percent of the market, Gartner said. Those totals allowed Dell to keep pace with HP, but the Round Rock, Texas, company didn't gain any ground on its rival, and the situation was even more dramatic in the U.S. market.

HP Pulling Away In The U.S. Market

The U.S. represents about 20 percent of the worldwide PC market, and it's dominated by HP and Dell, which combined control nearly 60 percent of the market. However, in the first quarter, HP managed to book nearly 16 percent and was the only major vendor to see U.S. growth in the quarter. Dell declined more than 4 percent, Gartner said. In the quarter, HP shipped about 3.6 million units in the U.S. while Dell shipped 3.2 million.

Consumers Aren't Buying New PCs

Consumers who still buy PCs are holding onto their machines longer, putting off replacing them until they have to, while others have "abandoned the PC market altogether," for mobile devices and 2-in-1s, Gartner said. Still, the PC remains the primary work device for business customers, even if they too put off new PC purchases for longer than they have in the past.