Hewlett-Packard (HP) has surprised the PC market by closing the gap with market-leader Dell to just two per cent during the first quarter of 2006.

Market watcher iSuppli claimed that the company, on the back of strong Q1 financial results, saw its second-place market share in the PC arena increase to 14.8 per cent during Q1, up 1.1 per cent from 13.7 per cent for Q1 2005.

HP shipped 8.5m PCs in Q1 2006, up 21.5 per cent from the 6.98m shipped for the same period last year. As a result, HP closed its market-share gap with Dell to just two percentage points, down from 3.3 points in Q1 2005.

In contrast, Dell showed signs of struggling in Q1 2006, shipping 9.6m PCs. This represented a market share of 16.8 per cent, down 0.2 per cent on Q1 2005.

iSuppli said that for HP to take market share away from Dell was a “notable development, considering that the trend has been in the opposite direction in recent years”. The company’s performance was propped up by strong sales of mobile PCs. In the market as a whole, mobile PC shipments were up 41 per cent in Q1 2006 against Q1 2005.

Matthew Wilkins, senior analyst at iSuppli, said: “HP achieved very strong growth in Q1 compared with 2005. However, it did not manage to topple arch-rival Dell from its number-one position in the overall Q1 PC rankings.”

Overall, the PC market enjoyed a solid first quarter. Shipments topped 57.4m units in Q1, up 12.8 per cent compared with Q1 2005. iSuppli said Q1 was a welcome surprise considering Microsoft delayed the launch of Windows Vista and Intel posted poor results. Most of the growth was generated by the mobile-PC segment, while desktop PC shipments grew by just three per cent.

Matt Bettinson, marketing manager at high-end integrator, Alienware, agreed that Q1 had been good for the industry.

“Q1 2006 covers the period when consumers genuinely warmed to the desktop replacement notebook concept, things such as larger form factors with 17in screens, and with the highest levels of performance,” he said.

“We found that the average selling price of notebooks actually went up during this period. Notebooks have been a star performer for Alienware for quite some time, and the trend shows no sign of slowing down.”

martin_lynch@vnu.co.uk