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Asus Warns PC Shipments Will Drop 10% in Q2

Asus hardware
(Image credit: Asus)

Asus is predicting a slowdown in the sales of its pre-built computers, as well as some of the key components it makes for the PC DIY market. DigiTimes reports that Asus co-CEO SY Hsu put some numbers to these predictions for Q2 2022; it expects desktop and laptop PC shipments to drop by 10% quarter-on-quarter, and motherboard and graphics cards by 10-15%. Both percentage figures represent the drops expected over the previous quarter.

The Asus-centric report from DigiTimes echoes some of the findings shared by Mercury Research, that we reported on earlier today. Dean McCarron from Mercury looked at the performance of the PC market quarter by quarter, and it was particularly illuminating to see analysis of PC industry decline with results divided between AMD and Intel camps. In brief, AMD was performing impressively by successfully riding the crashing wave, and in Q1 gained 27.7% market share, which was claimed to be a record high.

Moving back to the analysis of Asus' situation. An expected 10% drop in PC shipments in Q2 2022 is not too bad as Mercury Research predicts a 30% decline in PC shipments for the industry as a whole.

In our report about PC shipments from last month, when we checked over data from Q1 2022, it was found that Asus was outperforming all its rivals. It looks like it will continue to do better than average, if we consider the statements reported via DigiTimes.

So, why is Asus predicting a 10% downturn in PC shipments in the current quarter? Picking through DigiTimes' report it is stated that the pandemic easing and geopolitical factors (Ukraine war) are having a major impact on sales. Remember that the pandemic was a driver of strong sales for many quarters previously. We must also mention inflationary pressures and worries of a recession are slowing consumer electronics sales.

(Image credit: Asus)

Tom's Hardware readers will also be interested to hear of Asus' concerns with regard to a slowdown in the sales of its motherboards and graphics cards. Demand for these key PC DIY parts will drop by 10-15% in Q2 2022, according to Asus. Cryptomining demand has eased, says DigiTimes today, but gaming demand is still good, and prevents a more precipitous drop in sales of GPUs.

Asus made 66% of its revenue from PC desktop and laptop sales in Q1 2022. PC components bring in 33% of its revenue, with mobile phones accounting for just 1% of revenue. Asus will continue to launch new products through 2022 to maintain profitability. Interestingly, it also said that supplies of most chips are no longer in short supply. However, Asus still sees challenges in PMIC supplies, China lockdowns slowing some components, plus rising freight costs and congestion.

Mark Tyson
Mark Tyson

Mark Tyson is a Freelance News Writer at Tom's Hardware US. He enjoys covering the full breadth of PC tech; from business and semiconductor design to products approaching the edge of reason.

  • InvalidError
    Covid WFH forced many people and companies to do out-of-cycle or otherwise unneeded upgrades. People are no longer holed up from lock-downs either so entertainment PC sales would be down too. Then you have inflation steering many people's spending from luxury to essential goods. It shouldn't surprise anyone that PC/laptop sales are doing some catch-up on their pre-pandemic yearly sales declines.
    Reply
  • Phaaze88
    It's like some of these companies don't know that boosts are temporary...
    Reply
  • watzupken
    I don’t think this comes as a surprise really. COVID pretty much forced people globally to snap up desktops, laptops, tablets, printers, web cams, etc, at an unprecedented rate due to the abrupt fully work/ study from home plans. By now, each household would easily have more computers/ electronic devices than what they normally need since most are back in office/ school physically. So instead of a sustained demand for electronics, the resale market is flooded with electronic devices now. That’s why I feel while supply may still be “tight“, weakening demand will put downward pressure on prices of electronics. Any company selling electronics definitely made a windfall over the last 2 years. But clearly, we are slowly but surely moving back to the norm where they should not expect to make the same revenue/ profit. 10 to 15% decline is really a very conservative number when normal demand is likely a few times lower.
    Reply
  • Tom Sunday
    Admin said:
    It also expects motherboard and graphics card shipments to drop by 10-15% in the current quarter. Crypto crash, Ukraine war, China lockdowns, and inflation are all blamed.

    WOW…Asus predicting a 10% downturn in their PC business. Mercury Research calling it a 30% decline in PC shipments for the industry as a whole. That does not bode well. Looking at financial headwinds I do not think that Asus is really concerned about the Ukraine conflict, but more about the future expansionist attitudes of China. Asus is mainly production based in Taiwan and mainland China. It is also seen due to his vast military power and sheer Soviet determination that Putin will ultimately be getting away with his ‘take-back’ of the Ukraine and possibly more of the former lesser known Soviet provinces. Thus naturally enticing and fueling China to jumping onto the bandwagon.

    I cannot imagine what a Taiwan PRC interdiction would cause in the worldwide tech-industry! Taiwan is also not a member of the United Nations. Taiwan does not maintain an embassy in the United States, and the United States does not support a Taiwan’s independence. China has made it crystal clear: If Taiwan moves towards independence, China will reclaim Taiwan by force and not relinquish her sovereign right to protect her territorial integrity. All of this said, I wonder what 2023 will bring and park on our doorstep!
    Reply
  • tek-check
    Markets are saturated anyway. Who would want to buy a laptop every year or every two years anyway?
    In the last two years, entire world has been upgrading the gear. This "news" makes me think that vendors would like to create a climate of artificial scarcity to encourage people to buy. yet again.
    Reply
  • InvalidError
    tek-check said:
    In the last two years, entire world has been upgrading the gear. This "news" makes me think that vendors would like to create a climate of artificial scarcity to encourage people to buy. yet again.
    After almost three years of component shortages, you'd think the industry would welcome a lull in demand to let the supply chains and pricing settle down. Instead, they're panicking at the idea that a demand crash may force them to align prices closer to actual costs to sustain sales.
    Reply
  • bolweval
    tek-check said:
    Markets are saturated anyway. Who would want to buy a laptop every year or every two years anyway?
    In the last two years, entire world has been upgrading the gear. This "news" makes me think that vendors would like to create a climate of artificial scarcity to encourage people to buy. yet again.
    Agreed, I'm still using a 7 year old Dell laptop and still have no reason to upgrade it.
    Reply