Fifth consecutive year of worldwide PC shipment decline

Worldwide PC shipments totalled 72.6 million units in the fourth quarter of 2016, a 3.7 per cent decline from the fourth quarter of 2015, according to preliminary results by Gartner, Inc. For the year, 2016 PC shipments totalled 269.7 million units, a 6.2 per cent decline from 2015. PC shipments have declined annually since 2012.

"Stagnation in the PC market continued into the fourth quarter of 2016 as holiday sales were generally weak due to the fundamental change in PC buying behaviour," said Mikako Kitagawa, principal analyst at Gartner. "The broad PC market has been static as technology improvements have not been sufficient to drive real market growth. There have been innovative form factors like 2-in-1s and thin and light notebooks, as well as technology improvements, such as longer battery life. This end of the market has grown fast, led by engaged PC users who put high priority on PCs. However, the market driven by PC enthusiasts is not big enough to drive overall market growth."

"There is the other side of the PC market, where PCs are infrequently used. Consumers in this segment have high dependency on smartphones, so they stretch PC life cycles longer. This side of the market is much bigger than the PC enthusiast segment; thus, steep declines in the infrequent PC user market offset the fast growth of the PC enthusiast market."

Ms Kitagawa said that although the overall PC market will see stagnation, there are growth opportunities within the market, such as the engaged PC user market, the business market and gaming. However, these growth areas will not prevent the overall decline of the PC market, at least in the next year.

Four of the top six vendors experienced an increase in worldwide PC shipments in the fourth quarter of 2016 (see Table 1). The top three vendors all increased their global market share in the fourth quarter. Lenovo maintained the No. 1 position, as the company experienced shipment increases in North America and EMEA, while Asia/Pacific and Japan continued to be challenging markets.

Table 1

Preliminary Worldwide PC Vendor Unit Shipment Estimates for 4Q16 (Thousands of Units)


Company

4Q16 Shipments

4Q16 Market Share (%)

4Q15 Shipments

4Q15 Market Share (%)

4Q16-4Q15 Growth (%)

Lenovo

15,781

21.7

15,535

20.6

1.6

HP Inc.

14,808

20.4

14,204

18.8

4.3

Dell

10,723

14.8

10,175

13.5

5.4

Asus

5,452

7.5

5,960

7.9

-8.5

Apple

5,440

7.5

5,312

7.0

2.4

Acer Group

4,999

6.9

5,228

6.9

-4.4

Others

15,408

21.2

18,970

25.2

-18.8

Total

72,611

100.0

75,384

100.0

-3.7

Notes: Data includes desk-based PCs, notebook PCs and ultramobile premiums (such as Microsoft Surface), but not Chromebooks or iPads. All data is estimated based on a preliminary study. Final estimates will be subject to change. The statistics are based on shipments selling into channels.

Source: Gartner (January 2017)

HP remained in the second position, and it has recorded three consecutive quarters of shipment growth. HP secured the top position in PC shipments in the US and EMEA, growing faster than the regional averages.

Dell also registered three consecutive quarters of shipment growth in the fourth quarter of 2016. Dell continued to place PCs as a strategic business segment in commercial and consumer markets during 2016. Asus suffered the steepest decline among the top six vendors in the fourth quarter of 2016. Asus has been shifting its PC strategy more toward the high-end market, which will allow it to maintain better profit margins. Gartner analysts said the falling shipment volume could be the cause of this strategy shift.

In the US, PC shipments totalled 16.5 million units in the fourth quarter of 2016, a 1.3 per cent decline from the fourth quarter of 2015 (see Table 2). Five of the top six vendors in the US PC market experienced a shipment increase in the fourth quarter of 2016. However, this was offset by a 20.9 per cent decline in the Others category, and a 48.3 per cent decline in shipments by Asus.

"Similar to low-key back to school sales in the third quarter of 2016, big sales events, such as Black Friday, Cyber Monday and holiday sales are no longer effective marketing opportunities for PCs since PC purchases are generally driven by a 'need,' rather than 'want,' motivation," Ms Kitagawa said. "PCs are not a preferred gift item any longer, as consumers gravitate toward other consumer electronics, such as virtual personal assistant (VPA) speakers, virtual reality (VR) head-mounted devices, and wearables. Vendors and channels did not have high expectations for the holiday PC sales, so the marketing campaigns remained relatively quiet."

Table 2
Preliminary US PC Vendor Unit Shipment Estimates for 4Q16 (Thousands of Units)


Company

4Q16 Shipments

4Q16 Market Share (%)

4Q15 Shipments

4Q15 Market Share (%)

4Q16-4Q15 Growth (%)

HP Inc.

4,945

29.9

4,577

27.3

8.0

Dell

4,157

25.2

4,081

24.4

1.9

Lenovo

2,282

13.8

2,105

12.6

8.4

Apple

2,111

12.8

1,984

11.8

6.4

Acer Group

662

4.0

596

3.6

11.2

Asus

621

3.8

1,201

7.2

-48.3

Others

1,740

10.5

2,199

13.1

-20.9

Total

16,518

100.0

16,743

100.0

-1.3

Notes: Data includes desk-based PCs, notebook PCs and ultramobile premiums (such as Microsoft Surface), but not Chromebooks or iPads. All data is estimated based on a preliminary study. Final estimates will be subject to change. The statistics are based on shipments selling into channels.

Source: Gartner (January 2017)

For the year, worldwide PC shipments totalled 269.7 million units in 2016 (see Table 3). Total shipments in 2016 were at the same levels as shipments in 2007. Market consolidation escalated in 2016 as the top three vendors (Lenovo, HP and Dell) accounted for 54.7 per cent of worldwide PC shipments in 2016, up from 51.5 per cent in 2015.

Table 3
Preliminary Worldwide PC Vendor Unit Shipment Estimates for 2016 (Thousands of Units)


Company

2016

Shipments

2016 Market

Share (%)

2015

Shipments

2015 Market Share (%)

2016-2015 Growth (%)

Lenovo

55,888

20.7

57,274

19.9

-2.4

HP Inc.

52,458

19.4

52,548

18.3

-0.2

Dell

39,378

14.6

38,371

13.3

2.6

Asus

20,613

7.6

21,157

7.4

-2.6

Apple

18,612

6.9

20,377

7.1

-8.7

Acer Group

18,276

6.8

20,291

7.1

-9.9

Others

64,492

23.9

77,657

27.0

-17.0

Total

269,717

100.0

287,675

100.0

-6.2

Notes: Data includes desk-based PCs, notebook PCs and ultramobile premiums (such as Microsoft Surface), but not Chromebooks or iPads. All data is estimated based on a preliminary study. Final estimates will be subject to change. The statistics are based on shipments selling into channels.

Source: Gartner (January 2017)

PC shipments in Europe, the Middle East and Africa (EMEA) totaled 22 million units in the fourth quarter of 2016, a decline of 3.4 per cent from the same period last year (see Table 4). In 2016, the EMEA PC market reached 78 million units, a 5.9 per cent decline from 2015 (see Table 5).

"In the fourth quarter of 2016, due to the shortage of memory and screen components and the dollar conversion rates, we witnessed an increase in pricing, especially in the mobile PC segment," said Isabelle Durand, principal research analyst at Gartner. In the consumer market, Western Europe PC shipments showed better results in the fourth quarter of 2016 thanks to a successful Black Friday. Traditional notebooks, ultramobile clamshells, hybrid form factors and gaming PCs did particularly well among consumers in the UK and France in the fourth quarter of 2016.

The business segment recorded growth in PC shipments, led by Windows 10 deployments, which occurred in the fourth quarter. "Our 2016 enterprise survey also confirms the uptake in Windows 10 installations. It found that one in three businesses in Western Europe have started their Windows 10 deployments," added Ms Durand.

Asus recorded the worst performance in the fourth quarter of 2016. “Acer has been shifting its PC strategy more towards the high-end market and the falling shipment volumes could be the cause of this shift, but it will allow Asus to maintain better profit margins in the long term,” said Ms Durand.

In the UK, the effect of the Brexit negotiations and the devaluation of the pound sterling have not yet had any major detrimental impact on PC shipments. In France, the holiday season promotions had a very positive impact on the consumer PC market. Premium gaming PCs, notebooks and ultramobiles were among the top consumer purchases in France in the fourth quarter of 2016.

In Germany, healthy demand for business PCs came especially from large businesses that replaced their five to six year-old installed-base PCs with Windows 10 devices. Consumers bought mainly expensive high-end devices during the holiday season (notably gaming PCs and large-screen notebooks), which saw Android tablets further weaken.

"The EMEA PC market is expected to decline 4 per cent in 2017," said Ms Durand. The Windows 10 business PC market upgrade will stabilise demand through 2017 and beyond. However, PC prices in the UK will increase by up to 10 per cent in 2017, due to the devaluation of currency caused by the Brexit vote. "It is also evident that users are looking for a new computing experience using virtual reality and have a growing interest in gaming PCs, in which PC vendors are increasingly investing," concluded Ms Durand.

Table 4
Preliminary EMEA PC Vendor Unit Shipment Estimates for 4Q16 (Thousands Units)


Company

4Q16 Shipments

4Q16 Market Share (%)

4Q15 Shipments

4Q15 Market Share (%)

4Q16-4Q15 Growth (%)

HP Inc.

5,206

23.8

5,082

22.4

2.4

Lenovo

4,522

20.6

4,216

18.6

7.3

Asus

2,304

10.5

2,462

10.9

-6.4

Dell

2,296

10.5

2,131

9.4

7.7

Acer Group

2,055

9.4

2,092

9.2

-1.8

Others

5,518

25.2

6,683

29.5

-17.4

Total

21,901

100.0

22,666

100.0

-3.4

Note: Data includes desk-based PCs and mobile PCs, including x86 tablets equipped with Windows 8, but excludes Chromebooks and other tablets. All data is estimated based on a preliminary study. The statistics are based on the shipments selling into channels.

Source: Gartner (January 2017)

Table 5

Preliminary EMEA PC Vendor Unit Shipment Estimates for 2016 (Thousands Units)


Company

2016

Shipments

2016 Market

Share (%)

2015

Shipments

2015 Market Share (%)

2016-2015 Growth (%)

HP Inc.

18,355

23.5

17,964

21.7

2.2

Lenovo

15,394

19.7

15,677

18.9

-1.8

Asus

8,419

10.8

8,057

9.7

4.5

Dell

8,061

10.3

8,152

9.8

-1.1

Acer Group

7,084

9.1

7,959

9.6

-11.0

Others

20,657

26.5

25,054

30.2

-17.6

Total

77,970

100.0

82,863

100.0

-5.9

Note: Data includes desk-based PCs and mobile PCs, including x86 tablets equipped with Windows 8, but excludes Chromebooks and other tablets. All data is estimated based on a preliminary study. The statistics are based on the shipments selling into channels.

Source: Gartner (January 2017)

The Asia/Pacific PC market totalled 24.8 million units in the fourth quarter of 2016, a 3.9 per cent decline from the fourth quarter of 2015. The PC market was affected by two major events. First, the demonetisation of the Indian currency in India led to weaker-than-expected consumer PC demand. Second, the success of China's 11.11 (Singles Day on 11 November) online shopping event gave a boost to consumer notebook sales.

These results are preliminary. Final statistics will be available soon to clients of Gartner's PC Quarterly Statistics Worldwide by Region programme. This programme offers a comprehensive and timely picture of the worldwide PC market, allowing product planning, distribution, marketing and sales organisations to keep abreast of key issues and their future implications around the globe.

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