NEW YORK (CNN/Money) -
Dell Corp. surpassed rival Hewlett-Packard as the world's No. 1 maker of personal computers during the first quarter, thanks to stronger business buying, according to an industry report released Thursday.
Business spending also fueled the broader market, allowing it to build on solid growth from the second half of 2003, technology research firm International Data Corp. reported.
"This quarter's results ratify the economic recovery," said Roger Kay, vice president of client computing at IDC. "We have nearly a year of double-digit growth in the PC industry, which is a concurrent indicator of economic activity."
Dell's year-on-year growth surged 28 percent for the quarter with its global PC shipments nearing 7.7 million units versus 6 million units a year earlier. Its piece of the world market share pie inched up to from 16 percent in the fourth-quarter to 18.6 percent.
HP slipped into second place as its market share declined to 15.6 percent in the first-quarter from 16.7 percent in the previous three months. Its total worldwide shipments rose 15.7 percent on a year-on-year basis to 6.4 million units.
Dell and HP have alternated between the No. 1 and No. 2 spots over the past year, but Kay foresees Dell maintaining its lead as business spending continues to buoy the market.
"The first-quarter is a commercial quarter," he stated, adding that Dell is more weighed towards the business consumer.
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The report noted that Gateway has a "new outlook on life" having completed its acquisition of eMachines. Significant transitions, including the closure of its free-standing stores and efforts to segue into consumer electronics, will be a tough issue for the struggling computer maker, but its new business strategy and cost-structure gains should mitigate those concerns, IDC concluded.
Before the report, Dell (DELL: Research, Estimates) shares ended fractionally lower to $35.24 on the Nasdaq, while shares of HP (HPQ: Research, Estimates) finished marginally weaker at $21.89 on the New York Stock Exchange.
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