Intel forecast sparks warning of lower PC demand
October 18, 2012, 11:13 am TWN
TAIPEI -- British bank Barclays PLC warned yesterday that PC demand in the fourth quarter of this year will not be as strong as in the past after U.S. chip maker Intel Corp. forecast weak sales growth during the period.
Intel reported a day earlier third quarter sales of US$13.5 billion, beating Barclays' estimate of US$13.2 billion and the market consensus of US$13.23 billion.
The company said sales in the fourth quarter will grow only 0.7 percent sequentially to US$13.6 billion, plus or minus US$500 million, which is slightly below the market consensus of US$13.85 billion, according to Barclays.
"This is quite unusual, as we usually see inventory build into the peak holiday season," Kirk Yang, a Hong Kong-based analyst at Barclays, wrote in a note to clients.
"(Intel's guidance) suggests that normal demand seasonality in the fourth quarter of 2012 might not happen this year, even with the Windows 8 PC introduction Oct. 26," he said.
Yang said the opportunity for investing in PC name-brands on a short-term basis from strong shipments in September and October might be nearly over.
He suggested that investors should stick with industry leaders that continue to gain share, such as China's Lenovo Group and Taiwan's ASUStek Computer Inc.
The PC industry is showing signs of sluggish growth after two U.S. based research firms released lower-than-expected global PC shipment data for the third quarter.
International Data Corp. (IDC) said Oct. 10 that worldwide PC shipments declined annually by 8.6 percent to 87.8 million units from July to September this year, while Gartner Inc. data showed an 8.3 percent drop to 87.5 million units.
"A weak global economy, as well as questions about PC market saturation and delayed replacement cycles, are certainly a factor, but the hard question of what is the 'it' product for PCs remain unanswered," said IDC analyst Jay Chou.
"While ultrabook prices have come down a little, there are still some significant challenges that will greet Windows 8 in the coming quarter," Chou said.
Despite the slowdown in the PC industry, the IDC said the third-quarter shipments of Lenovo and Asustek still grew 10.2 percent and 10 percent, respectively, from a year ago, making them the only two among the top five vendors to record positive growth during the period.
Gartner's figures also showed that Lenovo's shipments increased 9.8 percent year-on-year, with Asustek registering an 11.8 percent growth in shipments.