PC MARKET DECLINE
Down but not out The worldwide PC market is experiencing unprecedented falls in sales, due to several factors, but it is a storm the sector is expected to ride out eventually.
Regional overview The US PC market declined 20.5% in Q4 of 2022, its sixth straight quarter of shipment decline. Echoing the trend of the global market, consumer and business PC spending slowed due to economic conditions. “Even as vendors offered deep PC discounts during the holiday season in an attempt to lower inventory, consumers were not swayed to spare their money,” said Mikako. The EMEA PC market declined by 37.2% year-on- year, due to political unrest, inflationary pressures, interest rate increases and a pending recession. “A decline of this magnitude only happens when market demand effectively comes to a halt,” said Mikako. “Business and consumer confidence across EMEA has collapsed, leading to a huge drop in PC demand. A massive increase in inventory has also severely limited sell-in opportunities as sellers focus on moving old stock.” The Asia Pacific market excluding Japan declined 29.4% year-on-year, mainly due to the Chinese market. While the fourth quarter has traditionally been peak season for China’s business PC market, budget cuts by the Chinese government and uncertainty around changing COVID policies led to a significant drop in demand. Annual overview Worldwide PC shipments totalled 286.2 million units in 2022, a 16.2% decrease from 2021 and the worst annual shipment decline in Gartner’s PC tracking history. This decline brings the total PC shipments in 2022 close to pre-COVID levels, with 2019 shipments well below 300 million units. “The PC industry experienced very unusual ups and downs over the past 11 years. After the extraordinary growth period between 2020 and 2021 due to the pandemic, the market has clearly begun a downward trend,” said Mikako. While the PC market is facing a major decline for the foreseeable future, it should be noted that the industry has been around for decades and has survived economic downturns before. It’s likely that the market will eventually recover in time. In the meantime, manufacturers and vendors will need to focus on finding ways to adapt to the current market conditions and to appeal to consumers and businesses that are tightening their budgets. This may mean offering more affordable options or finding new ways to market products.
Worldwide PC shipments experienced their largest quarterly decline since the mid-1990s in the fourth quarter of 2022, according to preliminary results by Gartner, Inc. In all, 65.3 million units were shipped in the fourth quarter, a 28.5% decrease from the same quarter in 2021, the biggest quarterly decline since Gartner started tracking the PC market. The decrease is attributed to several factors, according to Mikako Kitagawa, director analyst at Gartner. “The anticipation of a global recession, increased inflation and higher interest rates have had a major impact on PC demand,” he said. “Since many consumers already have relatively new PCs that were purchased during the pandemic, a lack of affordability is superseding any motivation to buy, causing consumer PC demand to drop to its lowest level in years.” Impact on enterprise market The enterprise PC market is also being impacted by a slowing economy. “PC demand among enterprises began declining in the third quarter of 2022, but the market has now shifted from softness to deterioration. Enterprise buyers are extending PC lifecycles and delaying purchases, meaning the business market will likely not return to growth until 2024,” added Mikako. In additionå, higher PC inventory levels started building in the first half of 2022 and have become a bottleneck for the market. Low PC supply caused by high demand and supply chain disruptions through 2021 quickly turned into an excess of supply once demand slowed. Vendor overview The top three vendors in the worldwide PC market remained unchanged in Q4, with Lenovo maintaining the No. 1 spot in shipments. However, even Lenovo experienced its steepest decline since Gartner started tracking the PC market, with shipments falling in all regions except Japan, declining by 30% in EMEA and Latin America. HP and Dell also experienced historically steep declines. HP was hit hardest in the EMEA market, where shipments decreased 44% year-on-year. For Dell, weak demand in the large business market impacted shipments in the second half of 2022.
Mikako Kitagawa director analyst Gatner
Q4, 2021 PC Shipments Q4, 2022
gartner.com/en
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