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Worldwide PC revenue continues to grow, but shipment falls for first time in two years

The personal computer (PC) market, which has been witnessing significant growth ever since the onset of pandemic as remote working became the norm, has for the first time after seven quarters has seen shipments decline by about 3 percent.

According to an analyst firm Canalys’ quarterly ‘PC analysis’ rerport, the PC market had a healthy start to 2022 as overall revenue grew by more than 15 per cent, despite the first year-on-year shipment decline since Q1 2020.

The latest Canalys data show that worldwide shipments of desktops and notebooks fell 3 per cent annually to 80.1 million units against a backdrop of major geopolitical turmoil and softening consumer demand. Revenue, however, hit $70 billion as prices continued to rise in a supply-starved market and consumers’ appetite for costlier PCs kept increasing.

Notebook shipments shrank 6 per cent year on year to reach 63.2 million units, while desktop numbers grew 13 per cent to reach 16.8 million units. While shipments have been hindered by external shocks, the revenue outlook and confidence in the long-term opportunity remain high due to the strong fundamentals around PC ownership and use. “Vendors and their shareholders have reason to cheer, as the PC industry’s revenue growth streak continued,” said Canalys Principal Analyst Rushabh Doshi.

People are using their PCs more often, for longer and for a greater range of tasks than ever before, the firm said. The last two years have greatly expanded the installed base, with over 150 million notebooks and desktops added between 2019 and 2021. Even if customers are forced to delay purchases due to rising prices in the short term, large wave of device refresh is inevitable, especially given that more than 50 percent of active devices are more than four years old, Doshi added.

Meanwhile, commercial demand will remain strong this year even as consumer and education purchasing falters. The resumption of workplace activity at close to pre-pandemic levels coupled with hybrid and remote workers needing higher-specified PCs to maximize productivity means business IT expenditure will remain elevated in 2022, Canalys noted in its study.

Lenovo tops the table

Lenovo remained the top vendor in the PC market in Q1 2022 with shipments of 18.2 million units, for an annual decline of 10 per cent. HP held on to second place but suffered the largest decline of the top five vendors, its shipments falling 18 percent year on year to 15.8 million units. Third-placed Dell posted healthy growth of 6 per cent, with its shipments reaching 13.7 million units on the back of its strong commercial focus, the firm added.

Apple and Asus also enjoyed growth, increasing shipments by 8 per cent and 24 per cent and taking the fourth and fifth positions respectively. “The first quarter of 2022 brought a fresh wave of headwinds to the PC market,” said Ishan Dutt, Senior Analyst at Canalys. “Seismic global events have had a negative impact on both the demand and supply side, hitting the industry at a time when consumer and education purchases have both naturally slowed after the highs of last year.”

The war in Ukraine has exacerbated the inflationary environment in major markets by driving up the price of commodities, ranging from oil and gas to metals to foodstuffs. In parallel, Covid-related lockdowns in Shenzhen and Shanghai have created new bottlenecks in manufacturing and distribution, just as vendors and the channel were beginning to find their feet. With no clear timeline on when these issues will be resolved, and the possibility of other black swan events, the industry must be prepared to tackle a new set of challenges and respond with the same resilience it has showed over the last two years, Dutt noted in a release.

While India-specific numbers are yet to be released, Doshi speaking to Businessline said that Asia Pacific which includes India has seen growth in shipments. “Even as the global PC market shipments declined by 3 per cent after seven consecutive quarters of growth, the APAC region which includes India saw continued growth. The APAC region grew by about 20 per cent and India would be broadly aligned to that growth. We would be releasing an India-specific PC market picture in a month or so,” he added.

Published on

April 12, 2022

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