Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
CATHY WOOD ARK GARBAGE ARK Funds Heading for 90% STOCK CRASH! - 22nd Jan 22
Gold Is the Belle of the Ball. Will Its Dance Turn Bearish? - 22nd Jan 22
Best Neighborhoods to Buy Real Estate in San Diego - 22nd Jan 22
Stock Market January PANIC AI Tech Stocks Buying Opp - Trend Forecast 2022 - 21st Jan 21
How to Get Rich in the MetaVerse - 20th Jan 21
Should you Buy Payment Disruptor Stocks in 2022? - 20th Jan 21
2022 the Year of Smart devices, Electric Vehicles, and AI Startups - 20th Jan 21
Oil Markets More Animated by Geopolitics, Supply, and Demand - 20th Jan 21
WARNING - AI STOCK MARKET CRASH / BEAR SWITCH TRIGGERED! - 19th Jan 22
Fake It Till You Make It: Will Silver’s Motto Work on Gold? - 19th Jan 22
Crude Oil Smashing Stocks - 19th Jan 22
US Stagflation: The Global Risk of 2022 - 19th Jan 22
Stock Market Trend Forecast Early 2022 - Tech Growth Value Stocks Rotation - 18th Jan 22
Stock Market Sentiment Speaks: Are We Setting Up For A 'Mini-Crash'? - 18th Jan 22
Mobile Sports Betting is on a rise: Here’s why - 18th Jan 22
Exponential AI Stocks Mega-trend - 17th Jan 22
THE NEXT BITCOIN - 17th Jan 22
Gold Price Predictions for 2022 - 17th Jan 22
How Do Debt Relief Services Work To Reduce The Amount You Owe? - 17th Jan 22
RIVIAN IPO Illustrates We are in the Mother of all Stock Market Bubbles - 16th Jan 22
All Market Eyes on Copper - 16th Jan 22
The US Dollar Had a Slip-Up, but Gold Turned a Blind Eye to It - 16th Jan 22
A Stock Market Top for the Ages - 16th Jan 22
FREETRADE - Stock Investing Platform, the Good, Bad and Ugly Review, Free Shares, Cancelled Orders - 15th Jan 22
WD 14tb My Book External Drive Unboxing, Testing and Benchmark Performance Amazon Buy Review - 15th Jan 22
Toyland Ferris Wheel Birthday Fun at Gulliver's Rother Valley UK Theme Park 2022 - 15th Jan 22
What You Should Know About a TailoredPay High Risk Merchant Account - 15th Jan 22
Best Metaverse Tech Stocks Investing for 2022 and Beyond - 14th Jan 22
Gold Price Lagging Inflation - 14th Jan 22
Get Your Startup Idea Up And Running With These 7 Tips - 14th Jan 22
What Happens When Your Flight Gets Cancelled in the UK? - 14th Jan 22
How to Profit from 2022’s Biggest Trend Reversal - 11th Jan 22
Stock Market Sentiment Speaks: Are We Ready To Drop To 4400SPX? - 11th Jan 22
What's the Role of an Affiliate Marketer? - 11th Jan 22
Essential Things To Know Before You Set Up A Limited Liability Company - 11th Jan 22
NVIDIA THE KING OF THE METAVERSE! - 10th Jan 22
Fiscal and Monetary Cliffs Have Arrived - 10th Jan 22
The Meteoric Rise of Investing in Trading Cards - 10th Jan 22
IBM The REAL Quantum Metaverse STOCK! - 9th Jan 22
WARNING Failing NVME2 M2 SSD Drives Can Prevent Systems From Booting - Corsair MP600 - 9th Jan 22
The Fed’s inflated cake and a ‘quant’ of history - 9th Jan 22
NVME M2 SSD FAILURE WARNING Signs - Corsair MP600 1tb Drive - 9th Jan 22
Meadowhall Sheffield Christmas Lights 2021 Shopping - Before the Switch on - 9th Jan 22
How Does Insurance Work In Europe? Find Out Here - 9th Jan 22
MATTERPORT (MTTR) - DIGITIZING THE REAL WORLD - METAVERSE INVESTING 2022 - 7th Jan 22
Effect of Deflation On The Gold Price - 7th Jan 22
Stock Market 2022 Requires Different Strategies For Traders/Investors - 7th Jan 22
Old Man Winter Will Stimulate Natural Gas and Heating Oil Demand - 7th Jan 22
Is The Lazy Stock Market Bull Strategy Worth Considering? - 7th Jan 22
METAVERSE - NEW LIFE FOR SONY AGEING GAMING GIANT? - 6th Jan 2022
What Elliott Waves Show for Asia Pacific Stock and Financial Markets 2022 - 6th Jan 2022
Why You Should Register Your Company - 6th Jan 2022
4 Ways to Invest in Silver for 2022 - 6th Jan 2022
UNITY (U) - Metaverse Stock Analysis Investing for 2022 and Beyond - 5th Jan 2022
Stock Market Staving Off Risk-Off - 5th Jan 2022
Gold and Silver Still Hungover After New Year’s Eve - 5th Jan 2022
S&P 500 In an Uncharted Territory, But Is Sky the Limit? - 5th Jan 2022

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

How This IBM Will Outlast the PC’s Extinction

Companies / Tech Stocks Jan 27, 2014 - 12:33 PM GMT

By: DailyGainsLetter

Companies

John Paul Whitefoot writes: The first raft of first-quarter earnings reports are in…and they’re not a total surprise. Against the backdrop of a weak U.S. economy and waning consumer confidence, some big go-to stocks are beginning to show signs of distress—few more (right now) than makers of personal computers (PC makers).


Two research companies tracking PC makers delivered their reports for the just-completed fourth quarter—they’re not encouraging. Gartner pegged fourth-quarter PC shipments at 82.6 million, a 6.9% year-over-year decrease. For all of 2013, it said sales fell 10%—capping off the worst decline in PC market history. (Source: Hardy, Q., “For PC Makers, the Good News on 2013 Is That It Is Over,” The New York Times web site, January 9, 2014.)

Numbers from International Data Corporation (IDC) were slightly better (or less bad). It said PC shipments fell 5.6% year-over-year to 82.2 million units. For all of 2013, IDC reported that 314.5 million PCs were shipped—which reaffirms Gartner’s reported 10% drop from 2012. (Source: Ibid.)

But that’s where the similarities ended. When it came to the future of PC makers, Gartner said the PC market could improve in 2014; meanwhile, IDC said there was no reason to believe the market would stabilize. Why? Because PCs are giving way to mobile devices, such as tablets and smartphones.

Going forward, PC makers will have to ask themselves if younger, on-the-go consumers, who use their mobile devices as a first computer, will ever want to invest in a fixed device like a PC.

IDC also said sales of PCs fell to 108 million units in the Asia Pacific (outside Japan) region—marking the first annual double-digit decline for this area. The decline in PC sales was the worst for PC makers in Taiwan, where fourth-quarter sales for Acer Inc. tanked by 28.6%. In a move that would shake up the overpaid underachiever on Wall Street, the Taiwanese PC maker said its executives will take a 30% pay cut. (Source: Gold, M., “Acer fourth-quarter loss leads to 30 percent executive pay cut,” Reuters, January 17, 2014.)

With more and more people turning to mobile devices to access and share information, it doesn’t look like 2014 is going to be a banner year for PC makers.

What about one-time PC makers? While International Business Machines Corporation (NYSE/IBM) reported weak fourth-quarter results, their future looks brighter than most PC makers.

IBM recently announced that revenue fell five percent to $27.7 billion in the fourth quarter—its seventh straight decline in quarterly revenue and fourth straight quarter that the company’s revenue fell short of analysts’ targets. Hardware revenue tanked 26% to $4.26 billion, services revenue fell 3.6% to $9.92 billion, and software revenue increased 2.8% to $8.14 billion. On a brighter note, the company said earnings increased six percent year-over-year to $6.19 billion, or $5.73 per share. (Source: “IBM Reports 2013 Fourth-Quarter and Full-Year Results,” International Business Machines Corporation web site, January 21, 2014.)

But not all is lost for this now former PC maker. The company has extracted itself from the slumping PC industry, so it is not limited by the same technological parameters as such PC makers as Lenovo Group Limited, Hewlett-Packard Company (NYSE/HPQ), or Dell Inc. (NASDAQ/DELL).

If anything, IBM has transitioned into a software company—and over the next few years, software will play an even more important role in the company’s growth. A product offering that has been kind to companies like Microsoft Corporation (NASDAQ/MSFT) and Oracle Corporation (NYSE/ORCL).

This article How This Tech Stock Will Outlast the PC’s Extinction was originally published at Daily Gains Letter

© 2014 Copyright Daily Gains Letter - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in