Retail PC Notebook Sales Fall, Analyst Blames iPad

| Apple Stock Watch

PC Notebook sales in the retail space have dipped for the first time, and Morgan Stanley analyst Katy Huberty believes the iPad is responsible for most of that dip. The analyst looked at data from NPD and found that growth began decelerating in March of 2010, shortly after the iPad was announced. In August, slowing growth actually turned to a 4% decline in retail notebook PC sales.

In a research note covered by Fortune, Ms. Huberty said that preliminary data for the first week in September showed another 4% year-over year decline.

Tablet “cannibalization” of the retail notebook market was to blame, and Ms. Huberty cited Apple’s iPad as the chief culprit. The analyst offered the chart below to demonstrate the decline since the iPad’s release.

This seems a propitious moment to point out that in February of 2009, Calyon analyst Shebly Seyrafi issued a downgrade for Apple based in part over concern about Apple’s lack of a netbook strategy that wouldn’t cannibalize MacBook sales. It turns out that Apple’s eventual answer to the netbook market, the iPad, has left MacBook sales intact, while PC notebooks as a whole have taken a dive.

Shares in AAPL traded lower Friday, closing at US$275.37, down $1.20 (-0.43%), on strong volume of 22.4 million shares trading hands.

Morgan Stanley Chart

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Bryan Chaffin

If the role of Apple were to be played by Beevis, he might say to PC manufacturers, “Sorry ‘bout that.”

I personally find this data to be pretty close to shocking.  Sure, the iPad is a big hit, but such a precipitous decline in retail PC notebook sales is just…shocking.

Now I want to see overall sales figures, along with MacBook/MacBook Pro sales.

Lee Dronick

I don’t know Bryan, and I am certainly not a financial analyst, but maybe it is just circumstantial.


Shocking indeed! You might expect macbooks to be eaten as well, but by bringing more customers to apple, we will see MacBooks continue to grow despite the growth of the iPad.


What doesn’t compute is that Jun/Jul/Aug are usually back-to-school months, and notebooks generally do well in those months. So, apparently, the economic downturn is seriously killing PC business, except Apple.

Lee Dronick

That is along the lines that I am thinking Vasic. Of course the iPad had an influence on notebook sales, but to be the primary reason that the sales went down?




Sorry, but people seem to be misinterpreting this.  The only month were there has been a drop in sales was in August 2010.  There has been a sharp decline in GROWTH of sales, but not in sales.  And the chart compares monthly sales in a Year over Year fashion (e.g., August 2010 compared to August 2009).  Basically, in Dec 2009 sales of netbooks grew by 70% over the sales from Dec 2008 (no surprise given what was going on in the economy in Dec 2008).  By July 2010 sales were only growing at 2% over those of July 2009.  Only in August 2010 was there in decline in actual sales over August 2009.  Most likely the effect shown in the chart has more to do with the economy at the points where data was collected then the iPAD.  Very low recession impacted sales in Dec 2008 made normal Dec 2009 sales (christmas season) look like strong growth.  Sales growth from March 2010 though August 2010 began to look weak because they were being compared to sales from March 2009 to August 2009 which is when people were receiving stimulus checks.  To really critically evaluate this data they would need to show Year to Year sales growth data going back to July 2008.  Then I am sure you would see very negative sales growth from Sept 2008 though April 2009.

By the way, I am not trying to diminish the iPad or Apple.  I love my iPad and I still hold the Apple stock that I bought before the iPhone was announced.


Or as marcsten suggested more concisely “RECESSION”


So you say recession, yet people are still buying millions of iPhones and Android smart phones and iPads and tons of other expensive toys.  Does not compute.


I think the best data point might be Best Buy, where not all stores have sold the iPad. Maybe their CEO is just giving Jobs a little tongue to make sure he’s got enough stock to sell this holiday season, but it seems as though they’d have sales data to compare environments where the iPad is a choice to those where it isn’t across a variety of stores such that they could compare stores of similar size and sales revenue.

Even if the “up to 50%” is deliberately chosen to make it seem as though the effect is more than it is, it’s probably certain that they can back up the general claim with data.

Bosco (Brad Hutchings)

Actually, Best Buy issued a press release today saying their CEO was literally speaking out of his ass.

The issue here is retail for consumer electronics. It’s wonderful for Apple because they have near complete control over pricing with no direct competition, and they have the Apple experience which lots of people like. It’s a horrendous experience everywhere else, including, not even notably anymore, Best Buy.


So you say recession, yet people are still buying millions of iPhones and Android smart phones and iPads and tons of other expensive toys.? Does not compute.

Misplaced priorities.  Some would rather have an iPad than eat or pay rent.  In all seriousness though, people who are buying iPads are not people who are seriously hurting because of the economy.

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