Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Microsoft Corporation (MSFT), Hewlett-Packard Company (HPQ) and Intel Corporation (INTC): The PC Crushes These Stocks

Shares of software giant Microsoft Corporation (NASDAQ:MSFT) are getting hammered today, down by 5% at the low. PC partner Hewlett-Packard Company (NYSE:HPQ) is seeing its shares crushed even more, with losses having flirted with 8%. Chipzilla Intel Corporation (NASDAQ:INTC) didn’t escape the beating, with its shares having lost more than 3% before recovering moderately.

Microsoft Corporation (MSFT)

The big news today is that the PC market just posted the biggest drop in nearly two decades, according to IDC’s latest estimates. Worldwide PC units fell by 14% in the first quarter, much worse than the 7.7% decline IDC had previously braced itself for. Further, IDC’s 7.7% prediction had already been reduced, so no one was prepared for the enormous dropoff.

Windows 8 has done the PC market no favors. In fact, IDC says Microsoft Corporation (NASDAQ:MSFT)’s new operating system platform slowed the market, as consumers aren’t too impressed by the radical interface changes that Microsoft Corporation (NASDAQ:MSFT)is pursuing. Windows 8 is a bold new vision, but it would seem that it’s too bold for the average user.

For better or for worse, Microsoft Corporation (NASDAQ:MSFT), Hewlett-Packard Company (NYSE:HPQ), and Intel Corporation (NASDAQ:INTC) all continue to rely heavily on the PC market, even as each company has tried diversifying away from it. Here are the respective operating segments that are still tied directly to PC sales.

Company Segment Revenue (MRQ) % of Total Revenue (MRQ)
Microsoft Windows Division $5.9 billion 27%
HP Personal Systems Group $8.2 billion 29%
Intel PC Client Group $8.5 billion 63%

Source: SEC filings. MRQ = most recent quarter.

Of course, both Microsoft Corporation (NASDAQ:MSFT)’s business segment, which includes Office, and Hewlett-Packard Company (NYSE:HPQ)’s printer business are also tied to the PC market, though to a lesser extent. Those two companies have additional collateral damage to cope with.

Dell Inc. (NASDAQ:DELL) has been able to mostly avoid the bloodshed, with shares hardly flinching. However, that owes primarily to the numerous buyout offers on the table. Even though Dell is keenly aware of how bad the PC market is, there are now three offers to consider, and investors are just waiting for an exit.

There’s no sugarcoating it: The PC is dead, and its demise just accelerated.

The article The PC Crushes Microsoft, Hewlett-Packard, and Intel originally appeared on

Fool contributor Evan Niu, CFA, has no position in any stocks mentioned. The Motley Fool recommends Intel. The Motley Fool owns shares of Intel and Microsoft.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.