June 28th 2002
By Mike Flaminio
Apple distributor Ingram Micro, the US's biggest PC distributor, has gone public with comments scotching some of the rumors concerned Mac and PC inventories.
Prior to Apple's recent Q3 warning, some analysts were forecasting around two weeks' stock inventory in the distribution channel. More recently, 15 weeks is the speculative figure on models such as the iMac G4.
However, Ingram Micro in a Reuters story says that US PC demand "has shown neither seasonal jumps nor unexpected dips". Kevin Prewitt, a director of product management systems and vendor relations said to Reuters that "Demand is relatively stable. It is not negative, not positive, not optimistic. It is neutral at this point,"
Hewitt also canvassed topics such as PC demand post 9/11. The story also says that Hewlett-Packard has up to 8-9 weeks' inventory, double its normal level.
The May-June sales bump traditionally expected by PC companies, due to Father's Day and graduation, was also absent, Hewitt said. Apple CFO Fred Anderson in his conference call during Apple's recent warning echoed the same sentiments.
Prewitt was also cautious about predicting an upswing. Ingram Micro is expecting its own sales to be $5.25 billion to $5.40 billion, down from $5.62 billion in Q1.
Analysis: Like Intel, Ingram is close to the US sales market due to its direct connection with retail distributors and business. However, it has more of a handle on corporate sales, as it does a great deal of business directly with that sector. While it does little work for Dell, the biggest seller of PCs in the industry, it has quality data on sales figures and model trends for Apple, IBM, Toshiba, Sony and HP, among others.
Ingram Micro's analysis will perhaps provide some atmosphere of calm among all the panic selling of tech stocks. Demand in the sector is flat - that much is clear. But IM isn't predicting a major downturn or upswing - merely a static market. Companies like Apple, Dell and others may have to burn cash for a quarter or two to keep prices and inventories down, but they can weather the storm until demand picks up again.