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Report: Holiday PC sales good enough

Retail sales in the United States fail to disappoint--or thrill--but they do meet expectations, according to preliminary results from market researcher NPDTechworld.

PC makers got what they expected for the holidays.

Holiday PC sales at retail in the United States were neither disappointing nor thrilling, according to NPDTechworld, which tracks unit sales at retailers such as Best Buy and Circuit City. But sales did meet expectations, according to preliminary results.

"Holiday sales came in as predicted. Desktop sales were weak, but notebooks were strong. And outside of those categories, products--such as multifunction printer/scanner/copiers--that performed well going into the holiday season continued to do well," Stephen Baker, an analyst with NPDTechworld, said Thursday.

Several manufacturers, including Hewlett-Packard, said they were satisfied with their sales over Thanksgiving weekend. Others predicted that their fourth-quarter sales in 2002 would match the preceding year's, and most did, at least at retail in the United States. When comparing 2002 holiday sales to 2001, "you will likely see the numbers be relatively close," Baker said. "Notebooks aren't a big enough piece, overall, to move the needle that far. But they're getting there."

Still, notebook sales were what carried the day for holiday 2002, just as they did a year earlier. The portable PCs, which sold well during all of 2002, saw double-digit year-over-year unit sales gains in November and early December, while desktop PC unit sales took a double-digit dip, Baker said.

Because manufacturers essentially met their targets,


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the PC industry is unlikely to face a widespread inventory problem. That's one good omen as 2003 gets under way, Baker said, because manufacturers won't have to worry about clearing the decks in order to begin selling new 2003 models.

Although "sales volumes may be okay," he added, "I'm not sure about profits."

Manufacturers used a host of rebates and other special promotions to lure customers during the holidays. The offers worked to motivate customers to buy, but they are likely to cut into companies' quarterly profits, Baker said.

November sales at retail were down an overall 16.5 percent, according to NPD. Desktop unit sales showing a year-over-year decline of nearly 20 percent, while notebook unit sales increased by almost 13 percent.