Preliminary results are in for PC sales in the first quarter of this year. Echoing Gartner's recent report predicting a fairly grim outlook for 2009, the numbers show a significant 6.5 percent year-over-year decline in PC shipments worldwide for Q1. Meanwhile, US PC shipments have recovered somewhat over the sharp decline experienced in Q4. And while Dell continues to cede significant market share to HP, Acer, and Toshiba, Apple's impressive growth over the last couple of years seems to have run smack into a brick wall.

Worldwide, HP continues to hold on to the top spot, seeing a 2.6 percent growth in unit shipments for the first quarter. Acer, rallying on increased demand for inexpensive netbooks and desktops, saw a big increase of 26.7 percent, moving up to 13 percent market share, just a tenth of a point behind second-place Dell. The beleaguered Dell is barely holding on to the number two spot, and felt the sting of a 16.9 percent drop in unit shipments. Fifth-ranked Toshiba saw a nice 18.4 increase year-over-year, while forth-ranked Lenovo saw a 7.7 percent dip. Other manufacturers together saw a 15.6 percent drop.

"Low priced mobile PCs continued to be the growth driver for the PC industry in most regions," said Mikako Kitagawa, principal analyst at Gartner, in a statement. The race to the bottom in prices will continue to drive down average selling prices and whittle down already razor-thin margins that most PC makers earn.

Data source: Gartner

In the US, the picture isn't much better. Overall shipments are down three-tenths of a percent year-over-year. That's better than the 10 percent decline from last quarter, but it's still an overall decline. Second place Dell took yet another beating, ceding 5 points of market share with shipments down 16.3 percent. Top seller HP nabbed a big chunk of that, as did number five Toshiba. And Acer made out big on its budget netbooks, making an impressive 49.5 percent increase in unit shipments.

"Low priced mobile PCs led market growth in the US," said Ms. Kitagawa, just as they did globally. "Mini notebooks did well in the challenging economic environment where consumers' number one priority was to save money, and continued to put pressure on low priced mobile PCs." This affected mainly consumer market segments, but budget-strapped schools are also looking into using netbooks to implement or expand one-to-one programs.

Data source: Gartner

Meanwhile Apple, with its reluctance to lower prices or compete much in the low-end market, may finally be feeling the full sting of the recession. The company experienced tremendous growth over the last few years, averaging about 33 percent growth since the beginning of 2007. While the company managed to maintain a scant 8.4 percent positive growth in year-over-year shipments during the first quarter, according to these early estimates Apple will record a 1.1 percent drop in shipments—the first year-over-year drop in several years. The company's iPod and iPhone business takes the sting out of this somewhat, and the company still enjoys healthy margins on its products. But it can't feel good to give up so much of its hard-earned market share, which peaked as high as 9.5 percent in Q3 last year.

PC makers still face a tough road ahead for 2009. Low-priced netbooks continue to increase in sales even as overall shipments decline. Looking to the rest of the year, there are some big questions: Will Apple jump in the game with lower-priced systems, or ride the storm out on its $25 billion in the bank? And will netbook maker Acer finally surpass the ailing Dell to become the number two PC maker?