According to data from AltIndex, an alternative data provider that specialises in stock and cryptocurrency insights, the global PC market is expected to see a third consecutive year of revenue decline, with a forecasted drop of $1.3 billion in 2024. This downward spiral is due to a combination of factors, including high inflation, declining consumer purchasing power, and a build-up of excess inventory. As a result, major manufacturers and retailers have been forced to cut prices and offer discounts to clear inventory, further eroding profit margins.
AltIndex noted that global demand for PCs declined sharply in 2022, recording the steepest drop since the 1990s. This was due to a combination of supply chain disruptions, the China lockdown, the Russian-Ukrainian war, and global inflation, all of which have negatively impacted the market. The report also notes that there are no signs of an improvement in the near future, with demand expected to remain weak in 2023 and 2024.
Data from the International Data Corporation (IDC) and Statista Market Insights show that global PC shipments have plummeted, with 186.7 million PCs shipped between January and September 2022, representing a 17 per cent decline from the previous year. This has led to stagnation in the PC market, which is expected to generate $220.5 billion in revenue in 2023, almost the same as last year, and $7.5 billion less than in 2021, when sales peaked. This trend is likely to continue, with the market not expected to rebound until 2024.
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The report finds that laptops, the largest and highest-grossing segment of the PC market, are expected to see a revenue decline of $100 million from 2022 to 2023, falling from $127.6 billion to $127.5 billion. This is largely due to a decline in consumer demand, as well as competition from other devices such as smartphones and tablets. Desktop PCs are expected to generate almost the same amount of revenue as this year, approximately $38 billion, while tablets are expected to see the biggest decline, dropping from $49.7 billion to $48.4 billion.
While Statista expects a $1.2 billion drop in tablet sales revenue in 2024, compared to 2023, this decline is not as significant as the one in the PC market. However, it’s important to note that tablet sales are still expected to generate $53.7 billion in revenue, which is still a substantial amount.
The report notes that, despite the decline in revenue, the stock values of major PC producers have increased significantly.
YCharts data shows that the market capitalization of Lenovo, the world’s largest PC maker, with a 23 per cent share of global shipments in 2023, has increased by nearly 50% year-over-year, reaching $14.7 billion recently. This is significant, as it shows that despite a decline in sales revenue, investors still see value in Lenovo and believe that the company is well-positioned for future growth.
Dell Technologies saw even more dramatic growth in its stock value, with an impressive 68 per cent increase year-over-year to $54 billion. This is likely due to the company’s strong financial performance and its ability to diversify its business beyond just PC sales.
It is interesting to note that Apple, the world’s fourth-largest PC producer by global market share, has also seen a significant increase in its market capitalisation. According to statistics, Apple’s market cap has grown by 26 per cent since last year and reached a record high of $2.97 trillion recently.
It is worth noting that HP Inc., the world’s second-largest PC maker, has seen its market capitalisation decline in the past year. According to the statistics, HP’s market cap has fallen by almost $1 billion since November of last year, and it currently stands at $28.3 billion.
In addition to a decline in its market cap, HP’s AI score is also relatively low, with a score of 43 out of 100. This score is calculated by AltIndex based on a variety of factors, including the company’s social media presence, web traffic, job postings, and insider trading activity. The low score suggests that the company’s social media presence has been decreasing over the long term, its web traffic has been declining month-over-month, and there has been a net selling trend among company insiders.