PC Shipment Decline Continued in First Quarter as Expected, with Hopes for Improvement Depending on Commercial Replacements & Economic Stability, According to IDC
Inventory reductions in the channel, which were a headwind through much of 2015, seem to be wrapping up. Similarly, some rebound in economic conditions should support both commercial and consumer activity going forward. Nevertheless, channels, vendors, and users remain cautious about new purchases. Overall, Asia/Pacific and EMEA performed slightly better than forecast, while the Americas pulled down worldwide results.
"In the short term, the PC market must still grapple with limited consumer interest and competition from other infrastructure upgrades in the commercial market," said Jay Chou, Research Manager, IDC Worldwide PC Tracker, "Nevertheless, IDC still projects total business IT spending to grow compared to 2015, and as we head toward the end of 2016 things should start picking up in terms of Windows 10 pilots turning into actual PC purchases."
PC shipments to the U.S. fell 5.8% to 13.6 million units in 1Q16. PC channels remained challenged with aging inventory although inventory churn has reportedly improved throughout the last two quarters. Market inhibitors that were present in 4Q15 lingered through 1Q16. These issues included softened demand due to global economic concerns, the Windows 10 free upgrade path stalling some consumer PC purchases, and increased attrition towards detachables. "Demand for PCs in the U.S. remains sluggish," said IDC Research Director, Devices & Displays, Linn Huang. "However, we should be entering a period of reprieve. Peak corporate and education buying seasons have historically started in the second quarter. With some IT buyers thinking about early Windows 10 transitions and with the potential continued ascent of Chromebooks in U.S. K-12, the PC market should experience a modest rebound in the coming months."
United States – Dell overtook HP Inc. for the first place ranking for the first time since the third quarter of 2009, ending a run of 25 consecutive quarters with HP Inc. at the top of the U.S. PC market. Dell's U.S. PC shipments rose 4.2% year over year to 3.48 million – good for a 25.6% share. HP Inc's PC shipments to the U.S. fell 14.1% to 3.44 million units (25.3% share). Lenovo continued its aggressive growth trajectory as its 1.9 million units shipped represented 21.1% year-over-year growth and accounted for 14.1% of total U.S. PC shipments. Apple's Mac shipments rose 5.6% year over year to nearly 1.8 million (13.0% market share). Acer's shipments fell 10.4% to 0.7 million, but the company overtook ASUS and Toshiba to regain a seat in the U.S. top five.
Europe, Middle East, and Africa (EMEA) – EMEA PC shipments declined double-digit year over year, which was in line with the forecast. 1Q16 was the last quarter to suffer from an unfavorable year-over-year comparison due to large Bing shipments in the prior year, which significantly affected the consumer market. Windows 10 had a limited impact on PC renewals as its rapid adoption came mostly from free software upgrades. The new products launched with Windows 10 and Skylake architecture supported sales growth but could not reverse the overall negative trend.
Asia/Pacific (excluding Japan) – The APeJ PC market continued to decline as end user demand remained soft, while vendors focused on inventory clearing. Economic uncertainty weighed on the overall market performance across the region, with businesses limiting their investments and many commercial projects being postponed or downsized, while consumer spending was dampened by currency fluctuations and increases in pricing.
Japan – The market performed slightly better than forecast but still had negative growth. Slowing economic outlook and continued uncertainty over currency rates further dampened demand.
Lenovo maintained its top global rank for the quarter with U.S. growth in excess of 20%. However, the company faced a challenging quarter in all other markets with international shipments declining 12.5% from the prior year, bringing total worldwide volume down 8.5% from a year ago.
HP Inc. remained the number 2 vendor as it navigated its separation from HP Enterprise during the quarter. The company struggled with some inventory issues in North America and a continued slow market in Latin America, with total worldwide shipments declining nearly 11% from the prior year.
Dell remained the number 3 vendor globally, outperforming the market with a decline of just 2%, and also pulled to the lead in the United States market. Strong shipments of notebook PCs helped the vendor achieve the best quarter among the top 5 vendors.
Apple took the fourth spot worldwide and continued to outperform the market, thanks to solid growth in North America.
ASUS declined 8.3% from a year ago and dropped to the number 5 position. North America still saw decent uptake, but the vendor faced challenges elsewhere, especially EMEA.
IDC's Worldwide Quarterly PC Tracker gathers PC market data in over 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.
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