To those paying attention to the market, reports about softening demand for PCs by consumers have almost become background music in recent months. So for many, the important questions are how significantly the market will contract in 2022 and when it is set to rebound. IDC on Friday said that the market will contract by 43.5 million units year-over-year in 2022, and will not return to growth for another year.
IDC believes that unit shipments of PCs will total 305.3 million units in 2022, down 12.8% from 348.8 million units in 2021. Tablet sales will drop to 156.8 million units, or by 6.8% from the previous year. In total, shipments of personal computing devices (PCs and tablets, or PCDs) will decline to 462.1 million units, by 10.8%, in 2022 compared to 2021. Sales of PCDs will contract further by 2.3% in 2023 before rebounding in 2024. But while shipments of PCs and tablets are higher than they were in pre-pandemic years, they are not going to return to pre-pandemic peaks, even in 2025.
IDC sees saturation of PCs in consumers' hands, a weaking global economy, and inflation as primary causes for the reduced outlook.
"Long-term demand will be driven by a slow economic recovery combined with an enterprise hardware refresh as support for Windows 10 nears its end. Educational deployments and hybrid work are also expected to become a mainstay driving additional volumes," said Jitesh Ubrani, research manager for IDC Mobility and Consumer Device Trackers.
One of the things that has been emphasized recently is that consumers are slowing their PC and tablet spending, whereas the enterprise market continues to buy new hardware. Indeed, IDC believes that consumers will buy 9.9% fewer PCDs this year, whereas enterprise purchases will be contracted by modest 1.6%. But apparently, consumers are not leading the pack here, as small businesses plan to reduce their procurements by 10.5% in 2022, whereas the public sector (government agencies, schools) will lower its consumption of PCDs by a whopping 20.3%.
"With economic headwinds gaining speed, we expect worsening consumer sentiment to result in further consumer market contractions over the next six quarters," said Linn Huang, research vice president, Devices & Displays, IDC. "Economic recovery in time for the next major refresh cycle could propel some growth in the outer years of our forecast. Though volumes won't hit pandemic peaks, we expect the consumer market to drive towards more premium ends of the market."
IDC's data is indirectly confirmed by Jon Peddie Research's report from earlier this week, which says that PC CPU shipments to PC makers declined by 33.7% year-over-year and sales of discrete desktop graphics cards decreased by 9.6% YoY in Q2 2022. Note that IDC counts PC boxes sold to distributors or end users, whereas JPR counts chips sold to hardware manufacturers. The fewer chips shipped to PC makers in Q2 2022, the fewer PCs will be sold in the next quarter or so.
Under Brandon the economy, inflation, (i.e. people's available income), and everything else just sucks.
Once Brandon is gone in 2024, we can begin to recover, and hopefully people & companies can afford to update their equipment.
Also, in spite of the recent beating the stock market has taken, the Dow and S&P 500 are still higher than they were in mid-January, 2021. So, you can focus on everything that's going poorly, but it's certainly not all bad.
And most of the factors hitting the US economy are actually world-wide (e.g. shipping costs & supply chain issues). In fact, the US is actually doing better in several key areas, compared to most other countries, including energy & food prices. Even inflation isn't as bad in the US as in many other countries. I think that's a positive story, but people don't like to hear "it's even worse, elsewhere", when they're upset about something.
It might interest you to know that 2024 is an election year, but the new administration doesn't take over until January 2025. Specifically, the inauguration happens on January 20th and the Congress usually begins a new session on January 3rd.