RESEARCH TRIANGLE PARK – Personal computer shipments plummeted in the first quarter compared to a year ago with Apple, PC market leader Lenovo and Dell seeing sales plummet by 30% or more. HP suffered slightly less with a drop of 24%. But if manufacturers could take heart in something it’s that quarter one shipments were nearly double of those in the fourth quarter which was the lowest three-month total reported by research firm IDC since it began tracking shipments in 2008.

And IDC doesn’t necessarily see a big rebound coming any time soon.

“By 2024, an aging installed base will start coming up for refresh,” said Linn Huang, research vice president for Devices and Displays at IDC, in analyzing the latest data. “If the economy is trending upwards by then, we expect significant market upside as consumers look to refresh, schools seek to replace worn down Chromebooks, and businesses move to Windows 11. If recession in key markets drags on into next year, recovery could be a slog.”

Lenovo’s reaction

Last week, Lenovo Chair and CEO Yang Yuanqing got ahead of the looming statistics reports from IDC and rival Gartner, saying Lenovo was aiming to improve PC sales as part of a strategy that also includes more investment in R&D talent and efforts to expand services revenue.

Lenovo, which operates global headquarters in Beijing and the Triangle, has reacted to falling sales with some layoffs, but to this point Apple has cut few jobs across the tech giant’s holdings. The drop in sales has proven to be a big problem for HP and Dell, however; both have announced thousands of job cuts.

Lenovo’s recovery triple play: Reignite PC growth, boost other revenues, step up tech recruiting

Inside the numbers

The first quarter shipments of 56.9 million were down 29% from the same period in 2022. However, they were much higher than the 2022 year-ending quarterly total of 30.5 million.

Yet IDC noted that the Q1 2023 data was hardly encouraging when compared to pre-pandemic numbers.

“Shipment volume in 1Q23 was noticeably lower than the 59.2 million units shipped in 1Q19 and 60.6 million in 1Q18,” IDC said.

Why the year-over-year drop? IDC cited several reasons:

  • Weak demand
  • Excess inventory
  • A worsening macroeconomic climate

Apple’s shipments fell the most at 40.5%.

Lenovo shipments declined 30.3% but its market share of 22.4%  remains more than one percentage point ahead of HP.

The companies also are under inventory pressure, IDC noted.

“Though channel inventory has depleted in the last few months, it’s still well above the healthy four to six week range,” said Jitesh Ubrani, research manager for IDC’s Mobility and Consumer Device Trackers. “Even with heavy discounting, channels and PC makers can expect elevated inventory to persist into the middle of the year and potentially into the third quarter.”