Tomahawk, WI 08/21/2014 (Basicsmedia) – Nearly Three years after taking over at Hewlett-Packard Company (NYSE:HPQ) CEO, Meg Whiteman, looks to have finally found a formula for solving the technology giant’s PC sales that were on the decline. Restructuring and cost cuts looks to have worked the magic for the company in the second quarter. Tim Bajarin president, Creative Strategies, in an interview on CNBC said that the ongoing improvement in PC sales looks set to improve even further as the refresh rate continues to improve in the corporate space.
“We as analysts have been tracking PC sales for the last two-quarters, and while we were down last year 10%, we are only going to be of negative may be 2-3% partially because corporate sales of PC’s have actually risen this year, and that has been strong. Part of that has been a refresh rate. You know every 2 or 3 years the corporations have a lot of machines that are too old and have to be updated, “said Mr. Bajarin.
Hewlett-Packard Company (NYSE:HPQ) biggest challenge in its effort to ensure further improvement in the PC sales segment continues to be competition especially from Lenovo and Dell Inc. (NASDAQ:DELL). The two competitors command huge market shares in terms of PC sales as well as other services and have also been growing at the same rate just as Hewlett-Packard.
“The fact of the matter is that Lenovo has become an incredibly powerful force in PC, and they are the greatest challenge to Hewlett-Packard Company (NYSE:HPQ) at the moment. Now Lenovo, of course, is extremely strong in China but in the U.S, Lenovo Corporate business with their ThinkPad business is extremely strong,” said Mr. Bajarin
Competition has also shifted to the server business as the race for the cloud continues to heat up. Huge companies like Apple Inc. (NASDAQ:AAPL) and Google Inc. (NASDAQ:GOOG) are in constant demand for server services to meet the increasing demand of clients and often turn to the likes of HP and Lenovo for services. Competition is set to be stiff in this space according Bajarin on the fact that Lenovo recently finished the acquisition of International Business Machines Corp.(NYSE:IBM)’s server business.