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PC shipments continue steady decline

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Worldwide PC shipments totalled 61,1-million units in the second quarter of 2017, a 4,3% decline from the second quarter of 2016, according to preliminary results by Gartner.
The PC industry is in the midst of a five-year slump, and this is the 11th straight quarter of declining shipments. Shipments in the second quarter of this year were the lowest quarter volume since 2007.
“Higher PC prices due to the impact of component shortages for DRAM, solid state drives and LCD panels had a pronounced negative impact on PC demand in the second quarter of 2017,” says Mikako Kitagawa, principal analyst at Gartner “The approach to higher component costs varied by vendor. Some decided to absorb the component price hike without raising the final price of their devices, while other vendors transferred the costs to the end-user price.”
However, in the business segment, vendors could not increase the price too quickly, especially in large enterprises where the price is typically locked in based on the contract, which often run through the quarter or even the year, Kitagawa says. “In the consumer market, the price hike has a greater impact as buying habits are more sensitive to price increases. Many consumers are willing to postpone their purchases until the price pressure eases.”
HP Inc reclaimed the top position from Lenovo in the worldwide PC market in the second quarter of 2017. HP Inc has achieved five consecutive quarters of year-over-year growth. Shipments grew in most regions, and it did especially well in the US market where its shipments growth far exceeded the regional average.
Lenovo’s global shipments declined 8,4% in the second quarter of 2017, after two quarters of growth. Lenovo recorded year-over-year shipment declines in all key regions. Kitagawa says the 2Q17 results could reflect Lenovo’s strategic shift from unit share gains to margin protection. The strategic balance between share gain and profitability is a challenge for all PC vendors.
Dell achieved five consecutive quarters of year-on-year global shipment growth, as shipments increased 1,4% in 2Q17. Dell has put a high priority on PCs as a strategic business. Among the top three vendors, Dell is the only vendor which can supply the integrated IT needs to businesses under the Dell Technologies umbrella of companies.
The Chromebook market has been growing much faster than the overall PC market. Gartner does not include Chromebook shipments within the overall PC market, but it is moderately impacting the PC market. Worldwide Chromebook shipments grew 38% in 2016, while the overall PC market declined 6%.
“The Chromebook is not a PC replacement as of now, but it could be potentially transformed as a PC replacement if a few conditions are met going forward,” Kitagawa says. “For example, infrastructure of general connectivity needs to improve; mobile data connectivity needs to become more affordable; and it needs to have more offline capability.”
PC shipments in EMEA totalled 17-million units in the second quarter of 2017, a 3,5% decline year over year.