Gartner Raises Worldwide PC Market Projections for Fourth Quarter of 2003 but Warns Against Over Exuberance.

Business Editors/High-Tech Writers

STAMFORD, Conn.--(BUSINESS WIRE)--Nov. 7, 2003

Driven by strong PC sales in the third quarter of 2003, Gartner Inc. analysts are increasing their projections for fourth quarter PC shipments.

Worldwide PC shipments will total 47.2 million units in the fourth quarter of 2003, a 12.4 percent increase from the same period last year, according to Gartner forecasts.

Gartner analysts are now projecting total worldwide PC shipments to be 164.3 million units in 2003, a 10.9 percent increase from 2002, up from the 8.3 percent projection in their September version.

"Third quarter results were stronger than had been expected, led largely by the home and small business markets," said Charles Smulders, vice president of Gartner's Computing Platforms Worldwide group. " We see the third quarter results as an encouraging sign, and consequently we have increased our forecast for the fourth quarter of 2003 as well as the year-end projections. But we remain cautious in our overall outlook."

Gartner analysts highlighted four issues that may spoil future PC growth prospects:

-- Large-corporate sales -- Demand remains lackluster, with the

notable exception of Europe, where the appreciation of the

euro against the U.S. dollar has been driving growth through

its impact on euro-denominated prices.

-- Home market sales -- Despite showing strong growth in the

third quarter of 2003, the U.S. home market could prove

fragile in the coming quarters, especially because its recent

growth may have been driven by temporary factors, such as

recent tax rebates and lower tax withholdings.

-- Inventory levels -- In the U.S. retail market, Gartner

believes that inventory levels in October were noticeably

higher this year than last year.

-- Japanese consumer market -- In the strong third quarter of

2003, the Japanese home market appears to have been heavily

influenced by early new model introductions in advance of

Japan's new PC recycling law, which became effective 1

October.

"A global economic recovery remains an essential ingredient for a strong PC market recovery. While U.S. recovery prospects appeared to have improved significantly in recent weeks, the outlook for the rest of the world continues to remain uncertain, with many countries intently looking to the United States to pull them out of the doldrums," said George Shiffler, principal analyst for Gartner's Computing Platforms Worldwide group

"Our forecast models continue to show strong potential for growth in the number of buyers upgrading over the next year, but levels of actual activity will be highly dependent on worldwide economic circumstances," Shiffler said.

Additional information is available in the Gartner Dataquest Perspective "4Q03 Global PC Forecast Scenarios Update: Stronger Growth Seen." The report examines key drivers and inhibitors to the PC industry for the fourth quarter of 2003, as well as projections for 2004. This report is available on Gartner's Web site at http://www3.gartner.com/DisplayDocument?id=414383&ref=g_search.

About Gartner

Gartner, Inc. (NYSE: IT and ITB) is a research and advisory firm that helps more than 10,000 clients leverage technology to achieve business success. Gartner's businesses are Research, Consulting, Measurement, Events and Executive Programs. Founded in 1979, Gartner is headquartered in Stamford, Conn., and has more than 3,800 associates, including approximately 1,000 research analysts and consultants, in more than 75 locations worldwide. Revenue for calendar year 2002 totaled $888 million. For more information, visit www.gartner.com.