Global PC Shipments Record a Double-Digit Crash in Q3

Global PC Shipments Record a Double-Digit Crash in Q3
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Global PC shipments fell 15.5% in the third quarter of 2022 to reach 71.1 million units, according to Counterpoint Research. The segment recorded another wave of huge YoY declines after the severe annual and sequential falls in Q2.

The 3Q22 decline was largely due to demand weakness across both consumer and commercial markets, which was mainly driven by global inflation. Despite components shortage issues being largely resolved, OEMs and ODMs are holding a relatively conservative view on 4Q22 and 1H23. The lull in PC demand continued in the quarter despite broad promotional activities from major OEMs, especially for consumer product lines. In addition, inventory digestion processes have been activated to deal with abnormally high levels as we enter the second half of the year.

Although it is the season of peak consumer device sales, PC OEMs believe the destocking process will continue into 2023. Based on our conversations with supply chain members, especially with components suppliers, the largest inventory numbers were in 3Q22 and will likely begin to decline in coming quarters but there is uncertainty within the supply chain on when shipment growth will restart. Lack of consumer demand in the back-to-school season, shrinking enterprise purchasing due to economic uncertainty, and increasing promotional events all created a drag on Average Selling Price (ASP) growth momentum and also impacted PC market revenue.

Lenovo booked a 16% decline, largely in line with the global PC market, consumer demand weakness was partly offset by enterprise spending. Its 23.7% market share remains flattish compared to last year, reflecting Lenovo’s strong position and efforts to cope with a shaky market.

HP took an 18% share in Q3 with 12.7 million unit shipments. This is the second quarter of lower than 20% market share by HP since 2016, largely due to its higher consumer mix, which meant it exited Q3 with a 26.5% decline. Dell also reported more than a 20% decline and a 17% market share. Its 12 million units were a bit higher than in 3Q20, right before Dell began to benefit from working style changes post the initial waves of COVID.

Apple reported a counter-market 7% shipment growth amid muted market momentum, thanks to its new product launch in late Q2 with shipments refilled after the China lockdowns in Q2 that interrupted ODM manufacturing schedules. Meanwhile, Asus reported a 9% decline, reflecting a relatively resilient performance due to its enterprise-focused strategy, in line with management’s target of outperforming shipment in 2022.

Overall, global PC shipments in the second half of 2022 will still be comparatively higher than the level before Covid broke out. However, chipmaker AMD claimed that PC market weakness already caused negative impacts on its results and outlook; while the management of Taiwan OEMs Acer and Asus, both shared their views that the PC industry will not recover until 2H23.

Looking into 2023, the sky is still covered by dark clouds. Counterpoint Research is also adjusting its 2022 shipment forecast to a 13% decline in soft PC demand. Among all PC product segments, they believe Arm-based PCs and gaming PCs are poised to weather the market downturn best, with the help from Apple’s M-series offerings as well as incremental R&D efforts from chip makers and the wider ecosystem.