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PC Outlook Remains Cautious, Despite Modest Third Quarter Gains

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The rise of Smartphones, Phablets and Tablets in 2014

Worldwide PC shipments are expected to fall by -2.7% in 2014, an improvement from the previous forecast of -3.7%, according to the International Data Corporation (IDC)Worldwide Quarterly PC Tracker. Although the third quarter results were a few points ahead of forecast with shipments down only -0.5% from the prior year, most regions and market participants saw this as a short-term gain rather than as a sign of stronger growth in the medium- or long-term.

Mature regions continue to grow while a resurgence in emerging regions has taken longer probably due to a later impact from phablets and tablets as well as slower economics and commercial replacements. Western Europe and Japan performed better than expected in the third quarter, but the gains were driven by a rebound from last year and short-term factors such as building fourth quarter inventory earlier in the year and continuing Windows XP replacement activity. Despite the relative short-term strength, mature regions are expected to see PC shipments decline again in 2015 and contract slightly through the end of the forecast.

The consumer market came in slightly ahead of projections in the third quarter, but shipments are still expected to decline -5% in 2014. Pressure from phablets and tablets seems to be waning as penetration rises and tablets move to smaller sizes and lower price points. However, competition for disposable income from smartphones and phablets is rising. In addition, the market was boosted in the third quarter by factors such as a rise in low-cost systems in many markets and a rebound in Western Europe, which helped restore volume to earlier levels but not without cost in value of shipments.

"The expansion of entry-level models, encouraged by Windows 8 + Bing systems, has helped improve consumer volume in recent quarters and should extend past the fourth quarter," saidJay Chou, Senior Research Analyst, Worldwide PC Trackers. "Chromebooks are similarly boosting the low-end commercial segment. However, the market is still recovering to near stable volumes with no significant growth in the forecast."

"In the best case for PCs, we'd see a significant wave of replacements as users who spent on phones, phablets  and tablets in recent years decide they really need to update their PC. Features like touch or convertibility, as well as Windows 10 could make systems more versatile and appealing, along with lower prices," saidLoren Loverde, Vice President, Worldwide PC Trackers. "However, we've seen steady progress on prices and new designs over the past year, and replacements are stabilizing PC shipments but not boosting total volume. Going forward, as younger generations become more mobile and Web oriented, and emerging regions in particular prioritize converged devices (or economy in number of devices to purchase), the PC market will continue to face tough competition and be more focused on replacements, with limited potential for growth."

 


PC Shipments by Region and Product Category, 2013-2018 (Shipments in millions)

 

Region

Product Category

2013

2014*

2018*

Emerging Markets

Desktop PC

85.7

80.2

76.4

Emerging Markets

Portable PC

96.2

83.7

85.5

Emerging Markets

Total PC

181.9

163.9

161.9

         

Mature Markets

Desktop PC

51.1

53.3

44.8

Mature Markets

Portable PC

82.2

89.4

85.2

Mature Markets

Total PC

133.2

142.7

130.0

         

Worldwide

Desktop PC

136.7

133.6

121.2

Worldwide

Portable PC

178.4

173.1

170.7

Worldwide

Total PC

315.1

306.7

291.9

Source:  IDC Worldwide Quarter PC Tracker, November 25, 2014

* Forecast data

See Table and Taxonomy Notes below.

 



PC Shipment Growth by Region and Product Category, 2013-2018

 

Region

Product Category

2013

2014*

2018*

Emerging Markets

Desktop PC

-9.6%

-6.3%

-0.9%

Emerging Markets

Portable PC

-12.9%

-13.0%

2.4%

Emerging Markets

Total PC

-11.3%

-9.9%

0.8%

         

Mature Markets

Desktop PC

-4.8%

4.4%

-2.3%

Mature Markets

Portable PC

-9.3%

8.8%

-0.2%

Mature Markets

Total PC

-7.6%

7.1%

-0.9%

         

Worldwide

Desktop PC

-7.8%

-2.3%

-1.4%

Worldwide

Portable PC

-11.3%

-2.9%

1.1%

Worldwide

Total PC

-9.8%

-2.7%

0.0%

Source:  IDC Worldwide Quarter PC Tracker, November 25, 2014

 

* Forecast data

 

Table Note:  Mature Markets include U.S., Western Europe, Japan, and Canada. Emerging Markets includes Asia/Pacific (excluding Japan), Latin America, Central and Eastern Europe (CEE), Middle East, and Africa (MEA).

 

Taxonomy Note:  PCs include Desktop, Mini Notebook and other Portable PCs which possess non-detachable keyboards, and do not include handhelds or tablets such as the Apple iPad, Microsoft Surface Pro, or Android Tablets

IDC'sWorldwide Quarterly PC Trackergathers PC market data in more than 80 countries by vendor, form factor, brand, processor brand and speed, sales channel and user segment. The research includes historical and forecast trend analysis as well as price band and installed base data.