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Software industry

IBM Exits PC Business, Selling to Lenovo in $2 Billion Deal

Strategic Insights

— 1 min read

IBM, the iconic company behind the 1981 creation of the Personal Computer (PC) platform, has made a shocking exit from the PC market by selling its PC division to Lenovo, a Chinese PC manufacturer. The deal, worth up to $2 billion, marks a significant cultural shift in the PC industry, as the third-largest PC manufacturer in the world cedes its PC business to a Chinese company. Analysts estimate IBM's market share to be around 6%, trailing Dell and HP, with Lenovo poised to take over the entire portfolio of desktop and laptop computers.

Key Takeaways:

  • IBM has sold its PC division to Lenovo, China's leading PC manufacturer, in a deal worth up to $2 billion.
  • The deal marks a significant cultural shift in the PC industry, with IBM exiting the PC business after 23 years.
  • IBM's PC division had not been profitable in several years, with management reports recommending scrapping or selling the unit.
  • Lenovo is ranked ninth largest PC company in the world and plans to take over IBM's entire portfolio of desktop and laptop computers.
  • The sale is expected to impact the global PC market, with Gartner Group predicting that three of the top 10 PC manufacturers may be forced out of the market by 2007.
  • IBM's exit signals the end of an era for the PC world, with the company's PC brand to be consigned to history.

Statistics:

  • IBM's market share in the PC industry is estimated to be around 6%.
  • Lenovo is ranked ninth largest PC company in the world.
  • The PC industry is expected to experience a slump between 2006 and 2008, with big corporate customers unlikely to replace their PCs during this period.
  • The sale of IBM's PC division to Lenovo could be worth up to $2 billion.

Sources:

Gartner Group

Lenovo

IBM

Jordan Press & publishing Co.

Note: The sources listed above are exactly as mentioned in the original text.

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