Worldwide PDA Shipments Declined 9% Year-Over-Year in 2Q02

Worldwide handheld device shipments declined 9.3% from 2.89 million units in Q2 2001 to 2.62 million units in Q2 2002. The second quarter also marked the first time that shipments of Hewlett-Packard and Compaq handheld devices were reported as one, since the completion of their merger. HP’s May 2002 acquisition of Compaq allowed the vendor to become the number-two handheld device vendor in Q2 2002. The overall worldwide handheld device market continued its sequential decline contracting in the second quarter, for the second straight quarter, which has affected almost all major vendors and all geographies. “The demand for handheld devices remained soft during the second quarter due to weak economies in most regions,” said Weili Su, senior analyst of IDC’s Smart Handheld Devices research service. “Looking a few months ahead, we expect worldwide market growth to remain flat from a year-on-year perspective, for the remaining two quarters of the year.” In the second quarter, after the merger with Compaq, Hewlett-Packard edged closer to the number-one vendor Palm. Given the previous success of Compaq’s iPaqs, Hewlett-Packard will continue to challenge Palm’s number-one market position in the worldwide handheld device market with its PocketPC offerings. Palm shipped 845,640 units with a unit share of 32.2% during the second quarter, down 5% year-over-year, and 33.3% sequentially. Palm’s unit share, however, rose 1.4% from Q2 2001. Conversely, Hewlett-Packard shipped 431,650 units, capturing 16.5% share, down 5.7% in combined (HP and Compaq) unit shares from Q2 2001.

On a sequential basis, Sony, Toshiba, and Legend were the only top-10 handheld device vendors that grew handheld device shipments in the declining environment, with sequential growth rates of 4.6%, 507%, and 52.4%, respectively. The handheld device market overall declined 16% in Q2 2002 compared with Q1 2002. Handspring experienced an expected decline in its handheld device business as it increases its focus on its converged device business. Traditionally the number-two vendor worldwide, Handspring retreated to number-four with 170,590 units of handheld device and a unit share of 6.5%.

Top 5 Vendors, Worldwide Handheld Device Shipment, Second Quarter 2002

	Q2 2002	Market	Q2 2001	Market	Shipment Growth
Vendor	Shipment	Share	Shipment	Share	2002/2001
Palm	845.64	32.2%	890.00	30.8%	-5.0%
Hewlett-Packard	431.65	16.5%	642.66	22.2%	-32.8%
Sony	261.38	10.0%	75.00	2.6%	248.5%
Handspring	170.59	6.5%	298.00	10.3%	-42.8%
Hi-Tech Wealth	119.74	4.6%	124.90	4.3%	-4.1%
Others	793.27	30.2%	861.34	29.8%	8.6%
All Vendors	2,622.27	100%	2,891.90	100%	-9.3%

Source: IDC

NOTE: * Shipments include shipments to distribution channels or direct to end-users. OEM sales are counted under the vendor/brand under which they are sold * Data for Hewlett-Packard includes shipments for both Hewlett-Packard and Compaq-branded products * Handheld devices include pen-based and keypad-based handheld devices * Data for all vendors are reported for calendar periods

IDC's Worldwide and U.S. Handheld QView is a quantitative tool for analyzing the global handheld device market on a quarterly basis. The QView includes quarterly worldwide and U.S. shipments segmented by vendor, operating system, and price band.