Life in the PC business is truly a case of “if only” as factors that detract from success continue to plague the hardware market.
Not only has the industry faced component shortages, but with China resorting to containment measures to curb the spread of the coronavirus, these supply issues were exacerbated in the second quarter.
Market analysis by Canalys found that global PC shipments fell 15% in the second quarter, mainly due to Chinese production issues. This drop took the market to its lowest level since the pandemic began to take hold in the first quarter of 2020.
Laptops fell 18.6% as consumers became more cautious about inflation and the cost of living, leading to lower demand. Desktops fared better, with an increase of 0.6%, driven by business spending on hardware.
“As expected, Covid lockdowns in key regions and cities in China for most of the second quarter severely affected PC manufacturing and export,” said Canalys analyst Emma Xu.
“The disruption of factory and port operations in Shanghai, Kunshan and Jiangsu has resulted in significant delays in orders from all major PC vendors. Although production and coordination began to improve at the end of May, production was below normal throughout the second quarter. »
In terms of vendors, the top three maintained their leadership positions, with Lenovo leading the pack, followed by Dell and HP.
Cost of living concerns have impacted demand, particularly from consumers, and these market conditions don’t appear to be easing anytime soon.
“Rising inflation is the dominant economic factor on consumers’ minds, and price increases on a basket of goods and services are relegating spending on PCs and other hardware behind more basic needs,” said Ishan Dutt, senior analyst at Canalys. “While the importance of having a premium device has not diminished, most PC owners with relatively basic computing needs will be content to weather this period of economic uncertainty and choose to refresh their devices when the pressure on their budgets will ease or if significant discounts by vendors and retailers occur later in the year.
“Businesses also face the threats of inflation and rising interest rates, but investment in PCs and IT in general remains critical to digital transformation in the post-Covid recovery. Vendors with strong commercial reputations, deep distribution partnerships, and portfolios focused on high-performance commercial use cases will be best positioned to mitigate the challenges facing the PC industry this year.