The chorus of computer hardware makers blaming weak demand in Europe for their softening results is way off-key, according to analysts.

In recent days, Dell and Intel have blamed the continent for warnings of lower than expected earnings.

Dell warned that revenue growth for the year would fall short of its 30 per cent target. Intel said third-quarter revenue growth would be below forecasts, rising only 3-5 per cent from the second quarter's $8.3 billion (€9.54 billion), instead of the expected 910 per cent.

Shares in Dell yesterday fell to their lowest point in two years - pulling the rest of the computer-making sector with it. Dell, the world's second largest personal computer maker, which employs nearly 6,000 people in Bray and Limerick, fell more than 8 per cent in heavy trade, which made it Nasdaq's most active stock. However, analysts report a healthy demand for PCs in Europe, with predicted growth rates for this year of 11-13 per cent, albeit below last year's exceptional 23 per cent.

Mr Howard Seabrook, vice-president and director of services at the Gartner Group market research firm, which tracks PC sales, said: "I am surprised at Dell's and Intel's statements. We have not seen substantial weakness in the PC market."

Gartner Group forecasts that the European PC market will grow by 11-12 per cent this year. Companies looking to higher growth were being unrealistic, Mr Seabrook suggested.

"Last year was a bumper year as many companies upgraded systems in anticipation of the year 2000 problem," he said.

His remarks were supported by Mr Andrew Brown, analyst at market researcher IDC, who forecast growth of nearly 13 per cent this year.

Few analysts dispute that worldwide growth in demand for PCs is reaching a plateau. Mr Ashok Kumar, analyst at Bancorp Piper Jaffray, pointed out: "This is a worldwide issue with Europe being one of the key culprits."

But he added that in order for European sales to have the effect Dell and Intel had claimed, they would need to have fallen 30 per cent. He blamed competitive factors for Dell's underperformance.

Other manufacturers are not suffering. Hewlett-Packard, for example, forecasts a year-on-year growth rate of 30 per cent in Europe from 1999 to 2000. Intel, too, has been coming under competitive pressure from Advanced Micro Devices, whose new Athlon chip is faster and cheaper than Intel's.

But even if European PC demand were holding up at present, the weak euro means sales do not look so good in dollar terms. And it may also raise a pricing question in the minds of European consumers.

Mr Michael Dell, chief executive of Dell, said: "They are seeing the value of their currency decline. They have been significantly less inclined to make expenditures in the form of technology."