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October 11, 2011

European Q3 PC revenues down 11%: Context

Vendors and distributors slashed prices to clear unsold stocks that had been building up since the end of 2010

By CBR Staff Writer

New PC sales figures from IT market research company Context show sales of PCs to business and consumers across Europe struggled to keep level during the third quarter of this year, compared to the same period a year ago.

The company said that the reason behind the cause was the lowering of prices by vendors and distributors to clear unsold stocks that had been building up since the end of 2010.

The figures exclude tablet sales across Europe, said Context.

Context reported that PC sales by the region’s top distributors representing approximately half of all sales in the third quarter of 2011, rose sharply by 9% – double that of the year previously – compared to the previous quarter as volumes rose in response to the price cuts.

However, the resulting 10% drop in average selling prices meant that sales revenues collapsed for the quarter and were down 11% compared to the same period a year ago, said the company.

The company added that consumer demand for PCs (including desktops, netbooks and notebooks) plunged, with European sales of consumer-oriented products down 18% for the quarter compared to last year.

Worst affected by declining demand were Europe’s southern countries.

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Context said in Italy, unit sales of PCs excluding tablets fell 10% in Q3 2011 compared to last year, with revenues down 21%, while over the same period in Spain PC unit sales fell 7% and revenues fell 15%.

Context co-founder and CEO Jeremy Davies said HP’s announcement on exiting the PC business in August has to yet to have any negative effects on the company’s share in the quarter.

"The company’s share of total unit sales through distribution rose from 31.6% in Q3 2010 to 33.6% in Q3 2011," Davies said.

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