In the first quarter of 2023, the world’s shipments of personal computers fell by about a third, with Apple Inc. suffering the biggest decline among the market leaders as the sector battles a post-pandemic slowdown in consumer spending.
Market research companies IDC and Canalys blamed the 29% and 33% decreases in shipments on sluggish demand, excess inventory, and a gloomy economic outlook in separate papers released on Monday.
According to Canalys analyst Ishan Dutt, “the majority of the challenges that afflicted the sector in the second part of last year have persisted into the start of 2023.”
Apple experienced the greatest decline among the top five PC manufacturers examined in the surveys, falling more than 40%. Dell Technologies Inc., which experienced a decline of about 31%, came next.
According to the reports, Asustek Computer Inc (2357.TW), HP Inc (HPQ.N), and Lenovo Group Ltd all experienced losses.
The data indicates that after a 2022 that saw their sales confined by the end of the pandemic-driven demand spike, PC makers are set for another quarter of dismal earnings.
But, the slowdown in demand and growth is providing supply chains time to settle after a difficult two years and allowing businesses to look into production options outside of China, according to IDC.
The market might begin to rebound later this year and pick up steam in 2024, according to both research firms, assuming the prognosis for the economy improves.
According to IDC, “we anticipate significant market upside as individuals seek to upgrade, schools aim to replace outdated Chromebooks, and corporations migrate to Windows 11.”
But, some economists are less upbeat in light of the banking crisis and indications that the Federal Reserve would keep raising interest rates in an effort to curb the still-high inflation rate.
Steven Fox, an analyst for Fox Advisors, said that despite widespread cost savings implemented by businesses, “the evidence doesn’t seem to support the premise that (the recovery) is going to happen.”
“From here, a demand crash is not anticipated. We claim that the situation is sluggish and will remain so.”