HP Inc. HPQ claims of “reinventing the PC market” by introducing a convertible laptop, Spectre Folio, with an exterior made of leather, at an event in New York.

The touchscreen laptop that folds into a tablet features Intel’s INTC 8th generation Core i5 or i7 processor, 8GB of RAM and 256GB of SSD storage. The device has a 13.3-inch Full HD display with Corning GLW Gorilla Glass 4. A 4K display option is expected to be added later this year.

The device also features other enhancements such as a battery life of up to 18 hours and optional 4G LTE connectivity. The leather exterior is clearly the key differentiator of this product. Per the company, the leather plays an “important role in the functionality of the device.”

Starting at $1,299, the new device will be available in two different colors. The cognac brown model will go on sale on Oct 29, while the bordeaux burgundy version is expected in late December.

HP to Cash in on the Growing Convertible PC Market

Over the last few years, 2-in-1 devices, which can function both as laptops and tablets have become a growing segment of the PC market. Sale of such convertible devices is a breather for the personal computing devices market, which has witnessed decline in shipment of traditional devices.

Per International Data Corporation (IDC) estimates, unit shipments for the global personal computing devices market, which comprises traditional PCs, tablets, and workstations, will decline 3.9% in 2018. The research firm anticipates the decline to continue throughout the forecast period as shipment volume shrinks to 383.6 million at a five-year CAGR of -1.5% in 2022.

However, despite the overall decline in shipments, growth in 2-in-1s (such as detachable tablets and convertible notebooks), ultraslim notebooks and even gaming desktop, is expected to help the market grow 3.6% in dollar terms to $237.3 billion in 2018, adds the firm. Notably, the firm predicts shipments of 2-in-1s to grow more than 9% this year.

We note that product innovation has helped HP maintain its leading position in PC market. The addition of Spectre Folio will attract more users that will eventually back HP’s top-line growth going forward.

Moreover, focusing on such devices will help HP gain an edge over other products such as Microsoft MSFT Surface Pro. However, intensifying competition from lower-priced products developed by Samsung, Huawei and Lenovo will continue to affect its market share.

HP Inc. Revenue (TTM)

HP Inc. Revenue (TTM) | HP Inc. Quote

HP currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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