Positive Indicators Emerge, Is the PC Market Poised for a Recovery?
The PC industry, which experienced its lowest sales in 17 years in 2023, is now showing signs of a potential recovery. Preliminary results from $Gartner(IT.US$ indicate that the PC shipments have recorded a growth in the fourth quarter of 2023, marking the first time in eight consecutive quarters.
During the quarter, the industry managed to ship a total of 63.3 million units, marking a modest 0.3% increase from the corresponding period last year. Meanwhile, inventory was normalized by the end of 2023, which had been an issue plaguing the industry for two years.
In total, the industry shipped 241.8 million PCs in 2023, indicating a 14.8% overall decline, and the first instance where shipments have fallen below the 250 million unit mark since 2006.
There are several positive indicators that suggest a potential market recovery, including:
1. AI Integration
PC upgrades are expected to receive a boost with the integration of AI capabilities, with products set to hit the shelves in 2024.
At the beginning of 2024, $Microsoft(MSFT.US$ announced the addition of a Copilot AI button to Windows, marking the first major change to the PC keyboard in decades. Microsoft's Executive Vice President and Chief Marketing Officer for Consumers, Yusuf Mehdi, announced in a blog post that users will be able to utilize Copilot for daily use with the new key.
Ahead of CES this week in Vegas, $NVIDIA(NVDA.US$ unveiled three new graphics cards, which will be used to power "AI-ready laptops". $Intel(INTC.US$ and $Advanced Micro Devices(AMD.US$ , which have yet to fully tap into the AI boom, announced a series of new processors dedicated to AI personal computers at CES. Several PC manufacturers, including Acer, $Dell Technologies(DELL.US$, $HP Inc(HPQ.US$, $LENOVO GROUP(00992.HK$ and Samsung, have also planned to launch AI-powered PC products.
"I have been in this industry for many, many years," HP Inc. CEO Enrique Lores said, "I have never seen an opportunity like this, to really drive innovation and drive new type of customer needs that we really think are going to be fundamental."
2. PC Refresh Cycle
PC refreshes occur periodically, following a predetermined schedule that aligns with the needs of the organization and technological advancements. Generally, most organizations replace a significant portion of their computer equipment every three to four years.
It is anticipated that the large and outdated installed base of commercial PCs, which will exceed four years by 2024, will require a refresh, coinciding with the urgent need to transition to Windows 11.
“The solid U.S. economy helped small and midsize business spending as the segment grew steadily. Large companies were still cautious about spending, postponing PC refreshes to 2024.” said Mikako Kitagawa.
3. Demand from Emerging Markets
With the development of the automotive and manufacturing industries, the demand for industrial PCs in Latin America is continually rising. The continent is also witnessing an increase in the use of cloud-based services, which in turn, is driving the demand for these PCs. According to Canalys, Latin America is anticipated to experience the highest growth in the global market, with an impressive projected growth rate of 12.2% in 2024.
A PC's performance is crucial in driving digital transformation. China has been accelerating the digital transformation process of its enterprises in recent years. An increasing number of Chinese companies have realized the importance of digital transformation and are investing heavily in funds and human resources to expedite the process.
What do experts/analysts say？
According to the industry research firm Canalys, global PC shipments for the year 2024 will reach 267 million units, marking an 8% increase from their 2023 predictions.
IDC predicts that 2024 will be a pivotal year for the PC market, and beyond 2024, growth is now expected to surpass pre-pandemic shipment levels and culminate in 285 million units by 2027.
Source: Gartner, IDC, Intel, CNBC
Disclaimer: Moomoo Technologies Inc. is providing this content for information and educational use only.
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