PC shipments will continue to grow at double-digit rates in the first quarter of 2004, and hold that pace throughout the year, market research company Gartner predicted Thursday.

In the first quarter of 2004, PC vendors will ship 44 million units, up 13.3 per cent from the first quarter of 2003, Gartner said. Consumer notebooks continue to lead most of the growth as wireless technologies improve and prices fall, the company said.

The rest of the year will see an increase in the number of corporations upgrading their ageing PC inventories, Gartner said. This "corporate replacement cycle" has been eagerly awaited for about two years, but has been spread out over a longer period of time compared to the last major replacement cycle in 1999.

Corporate customers will be a strong part of the market in the second half of the year, especially in the US, Gartner said. Companies will continue to gradually move forward with PC purchases as the economy strengthens and businesses become more confident in the recovery.

PC vendors will ship 187 million units in 2004, up 13.9 per cent from 2003 shipments, Gartner said. All four quarters in 2004 should show double-digit increases in PC shipment growth as compared to the previous year, it said. In the fourth quarter of 2003, PC shipments increased 12 per cent from the same period in 2002.

Due to the weakness of the US dollar over the last year, the Western European business market outperformed the US business market in 2003, Gartner said. This trend should continue as long as the dollar remains weak, and the forecasted growth among US business customers will lift the overall numbers, Gartner said.

The top two worldwide PC vendors are scheduled to report earnings over the next week, and both Dell and HP will also provide guidance on how they see the PC market shaping up for the rest of the year.

HP reported yesterday that it expects to record $19.5 billion in fourth quarter revenue and earnings per share ahead of analyst estimates. HP's results will be released next Thursday.