Industry Analysts Predicting PC ‘Revival’

Industry Analysts Predicting PC ‘Revival’

Industry analysts at Gartner & IDC are out with reports predicting a ‘revival’ for the PC market.

“2014 will be marked by a relative revival of the global PC market,” said Ranjit Atwal, research director at Gartner. After declining 9.5 percent in 2013, the global PC market (desk-based, notebook and premium ultramobile) is on pace to contract only 2.9 percent in 2014.

“Business upgrades from Windows XP and the general business replacement cycle will lessen the downward trend, especially in Western Europe,” said Mr. Atwal. “This year, we anticipate nearly 60 million professional PC replacements in mature markets.” The traditional PC market (desk-based and notebook) will follow the same downward trend and is on pace to contract 6.7 percent in 2014 and 5.3 percent in 2015.
Worldwide PC Market to Show Relative Revival in 2014

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The personal-computer industry showed signs of improvement last quarter as businesses bought enough machines to revive sales growth at Microsoft Corp. (MSFT) and fuel Intel Corp. (INTC)’s biggest revenue gain in more than two years.

Intel’s sales increased 7 percent in the quarter that ended in June, according to the average of analysts’ estimates compiled by Bloomberg. Microsoft is likely to report that revenue rose 10 percent after stagnating the previous period, the projections show. The software maker may also announce job cuts related to the acquisition of Nokia Oyj’s handset unit, people with knowledge of the matter have said.

Corporations are replacing older computers at a faster clip, spurring a 6.9 percent increase in U.S. PC unit sales last quarter, according to researcher IDC. That’s good news for Intel, Microsoft and other companies that rely on demand for PCs and have been slow to adapt to the shift toward mobile devices and software delivered via the Internet.

“A lot of the growth is in big companies,” said Loren Loverde, who heads PC market research at IDC.
Bloomberg | By Ian King, Dina Bass and Adam Satariano

Not So Fast…

Ultramobile hybrids and Windows XP upgrades have slowed the bleeding but the PC slump hasn’t ended.

To say the predicted figure represents a PC revival, even a relative one, might be hyperbole. This year’s predicted 2.9% drop is relative to last year’s disastrous baseline. PC shipments, in other words, are still declining; they just aren’t tumbling as rapidly as before.

Moreover, the 2.9% slip includes a number of devices that might not fit all users’ notion of a PC. Gartner’s overall PC figures include “premium ultramobile” devices, which the firm defines as models that maintain full data-processing capabilities but “extend the notebook usage model toward the tablet by refinement of physical characteristics” that include a light weight and portable size, a smaller screen than most notebooks offer, and instant-on capabilities. Gartner includes many Intel x86-based Windows tablets and Apple’s MacBook Air in this category.

If premium ultramobiles are removed from the equation, Gartner expects traditional desktop and laptop PC shipments to drop 6.7% this year, and another 5.3% in 2015. The firm said 296.1 million traditional PCs shipped in 2013, but expects that number to drop to 261.7 million by 2015. At the same time, it expects premium ultramobiles to carve out a strong niche. The devices accounted for 21.5 million shipments in 2013, but Gartner predicts that figure will jump to 32.3 million this year, a 50.2% improvement. In 2015, Gartner expects premium ultramobiles to account for almost one-fifth of all PC shipments, with 55 million units overall.
Information Week | Michael Endler

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