Windows 10 business refresh will revive PC shipments

Or so says a hopeful IDC after releasing latest forecast of doom

The pandemic fueled buying frenzy in the PC industry looks to be well and truly over with analysts at IDC forecasting a double digit decline in shipments this year, and growth hopes for next pinned on a Windows 10 enterprise refresh.

Unit sales soared in 2020 and 2021 as government imposed lockdowns forced a change in the way work people worked, learned and entertained themselves. The PC was back in a big way and the industry logged sales records not witnessed in almost a decade.

Yet what went up is now coming down and IDC has downgraded its shipment outlook, estimating that 305.3 million computers will ship into channels during this 12 month calendar, down 12.8 percent, and tablets will fall 6.8 percent to 156.8 million.

The reasons for the forecast are familiar to many Reg readers: a hike in inflation, a weakening global economy and people simply not needing to buy new machines at the same rate.

“Though demand is slowing, the outlook for shipments remains above pre-pandemic levels, said Jitesh Urbani, research manager for IDC’s Mobility and Consumer Device Tracker.

“Long-term demand will be driven by a slow economic recovery combined with an enterprise hardware refresh as support for Windows 10 nears its end. Educational deployments and hybrid work are also expected to become a mainstay driving additional volumes,” he added.

Windows 11 was released in October and so large corporate enterprises may well feel more comfortable replacing existing machines from next year. Support for Windows 10 doesn’t end until October 14, 2025.

Consumer devices – PCs and tablets – are expected by IDC to decline 9.9 percent in 2022 to 265.3 million; Enterprise is said to be on track to shrink 1.6 percent to 57.6 million; Public Sector is expected to dip 20.3 percent to 69.2 million; and SMB will dive 10.5 percent to 70 million, IDC said.

The dropoff in Public Sector is partially due to Chromebook saturation in the US, particularly in education. America had typically accounted for 70 percent of shipments.

IDC said it expects "worsening consumer sentiment to result in further consumer market contractions overt the next six quarters."

HP's Q2 consumer PC sales plunged 20 percent in Q3 of its fiscal 2022 and contributed to a 3 percent overall dip in its Personal Systems Group sales, the company confirmed this week. Commercial PC shipments grew.

Boss Enrique Lores said: "Consumer softness is likely to continue in the near term. We also see some companies taking a more measured approach to their spending and new orders showing signs of softening demand in commercial categories."

Over at Dell, its PC division grew 9 percent to $15.5 billion, but the consumer sales were down 9 percent to $3.3bn and commercial grew 16 percent to $12.1 billion.

CFO Tom Sweet said of the business, "We are seeing demand weakness in both Consumer and Commercial." ®