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Can Lenovo Group Limited (LNVGY) Dominate In The Struggling PC Market?

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The PC market has been slowly declining in this era of powerful smartphones and tablets. Worldwide unit shipments in Q4 fell to around 90 million, which showed about a 5% decrease compared to the year before. Shipments fell around 2% in the U.S; however, tech sector analyst Canalys believes that the PC market is booming.

Earnings Analysis: Lenovo Group Ltd. ADS (LNVGY)The reason for this “boom” is that tablets have also been included in the PC market, as the market for tablets has grown significantly. While the tablet market is growing, PC giants, including Dell Inc. (NASDAQ:DELL) and Hewlett-Packard Company (NYSE:HPQ), find themselves struggling. Dell has decided to go private, and rumors suggest that HP may be considering a breakup.

Lenovo Group Limited (PINK:LNVGY), on the other hand, showed nearly 10% growth in PC shipments with more than 1.4 million units. Even after aquiring IBM’s Thinkpad line, Lenovo has never been a dominant force in the PC industry against HP and Dell. However, 2013 might just be the year when Lenovo gets on top. After having a successful year in terms of the PC market share, Lenovo has expanded into smartphones and tablets.

How Lenovo can dominate in 2013

Previously, Lenovo was seen as a brand for low-end laptops at cheap prices. However, the company has now switched to high-end tablets and PCs, with Windows 8 being a key factor. Microsoft’s Windows 8 has not been doing well, although the concept is fantastic and the OS offers a variety of new features.

Windows 8 is meant to be used for touch-screen monitors, tablets, and laptops. Lenovo, along with HP and Dell, has entered into a new “Convertibles” or “Hybrid” market. Basically, these new Windows 8 devices are touchscreen tablets which can transform into powerful notebooks.

Lenovo has released some fantastic Windows 8 convertibles, including the Thinkpad Twist, the IdeaTab Lynx, and the Yoga 13, which is possibly one of the best notebooks/tablets of 2013. Lenovo’s CEO, Yuanqing Yang, believes that innovation is the key to success in the new Windows 8 market and Lenovo’s Ideapad Yoga 13 is definitely the product which stands out in the market.

While Lenovo has released, possibly the best Windows 8 devices for 2013; HP and Dell have also created products with touch-screens, for better user experience on Windows 8. HP recently released the Envy X2 convertible and the new HP touch-smart sleekbook will hit stores by the end of February. Dell has also released 2 new Windows-8 hybrids, including the XPS 12 and the Tablet 10. However, things are only looking good for Lenovo at the moment, as the company plans to increase shipments worldwide. Dell and HP, meanwhile, face lower growth in the PC market and look to improve shipments with the new Windows 8 devices.

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