Gearbest Tech
【Gearbest】Whether time is fast or slow, whether you and I have noticed it or not, in the first half of the year, countless industries have undergone profound changes. Moreover, compared with the past few years, this year's situation is even more special. Focusing on the Internet, technology and other fields, this change is particularly obvious and worth our careful review.
Laptops on a roller coaster ride, recovery may come in the second half of the year
Overall, in the first half of 2023, various industries began to get rid of the impact of the epidemic in the past few years, and most industries have achieved recovery and returned to the track of growth. Of course, the road is tortuous. Even if the epidemic is no longer there, they will face new challenges. At the same time, the presence of Chinese companies in many industries has rapidly increased, and they have gradually begun to play a more important role.
Looking at it in detail, in the mobile phone industry, the long-term market slump has intensified the competition among manufacturers, and the just-concluded 618 promotion has pushed this competition to a climax; in the automobile industry, China continues to maintain its position as a leader in new energy, but the industry landscape is quietly changing; in the smart wearable industry, Apple, Huawei, and Xiaomi have been making a lot of moves, and the industry may usher in a new round of changes; the laptop industry experienced a “cold winter” in the first half of the year, but according to Lenovo's chairman's prediction, this may be the “last darkness before dawn”; in the computer installation industry, both old and new players are making their own calculations, and the good news is the rise of Chinese manufacturers.
In summary, Gearbest has launched a series of special topics called “Gearbest Mid-Year Observations” to focus on the development of various industries in the first half of 2023, focusing on the changes in industries such as technology and automobiles this year, and we will also look forward to their development trends in the second half of the year. This article focuses on “the development of the laptop industry this year.”
Gearbest mid-year observation: Laptops may recover in the second half of the year
In 2021, shipments of both laptops and desktops hit record highs, with global laptop shipments reaching a record 268 million. But laptop shipments began to decline in 2022, and this situation continued into the new year. Global PC shipments fell 33% in the first quarter of 2023, and shipments in the Chinese PC market fell 24%. However, there are now multiple signs that laptop shipments are expected to recover in the second half of 2023.
Shipments plummeted in the first quarter
In the first quarter of 2023, global PC shipments plummeted. Canalys data shows that the global PC market faces further turbulence in the first quarter of 2023, with total shipments of desktops and laptops falling 33% to 54 million units, marking four consecutive quarters of double-digit annual declines. Among them, notebook shipments fell sharply by 34% to 41.8 million units. Desktop shipments fell slightly, down 28% to 12.1 million units.
Global PC market shipments in the first quarter of 2023
At the same time, a report released by market research firm TrendForce also showed that global notebook computer shipments in the first quarter of 2023 were approximately 33 million units, a year-on-year decrease of 39%.
Looking at each market segment, in the first quarter of 2023,Chinese mainlandShipments of personal computers (desktops, notebooks, and workstations) fell 24% year-on-year to 8.9 million units. Although business activities have recovered after reopening, corporate and consumer spending on computers remains conservative. Desktop (including desktop workstation) shipments fell 28% to 2.8 million units, and notebook (including mobile workstation) shipments fell 22% to 6.1 million units. Tablet shipments rose against the trend, with total shipments increasing 38% year-on-year to 6.5 million units.
China's PC shipments fell 24% year-on-year in the first quarter of 2023
USAThe PC market also cooled. In the first quarter of 2023, US PC shipments fell 28% year-on-year to 14 million units. Laptop shipments fell 31% to 11.4 million units, and desktop shipments fell 28% to 2.7 million units. Tablets performed relatively well, driven by the strong performance of Apple's iPad, with shipments only falling 7% to 10.8 million units.
In the first quarter of 2023,Western EuropePC shipments fell 37% year-on-year to 10 million units. The two major personal computer categories faced significant declines, with notebook shipments falling 37% to 8.1 million units and desktop shipments falling 35% to 1.9 million units. Tablet PCs performed slightly better, but shipments still fell 20% year-on-year to 5.2 million units.
IndiaThe PC market also saw a sharp year-on-year decline of 35%, with shipments of 3.9 million units. Laptop shipments fell sharply by 41% to 2.1 million units. Desktop shipments fell relatively less, down 7% to 859,000 units. Tablet shipments fell 37% to 987,000 units.
Reasons for the decline in shipments
There are many reasons for the decline in notebook shipments, but the main reason is the weak economy.
“Most of the problems that plagued the industry in the second half of 2022 have continued into early 2023. Channel partners' inventory levels have been declining, but remain high in absolute terms,” said Ishan Dutt, senior analyst at Canalys.
Demand remains subdued across all commercial markets, with further interest rate increases in the U.S., Europe and other markets adding pressure to the commercial market. At the same time, consumers and businesses remain cautious about spending on new PCs in the near term.
TrendForce said that due to the continued impact of economic weakness, the confidence of the notebook computer consumer market has been shaken, which has slowed down the progress of manufacturers' inventory reduction and prompted major brands to further reduce orders from foundries. However, TrendForce expects that in the second quarter, with the expectation of easing inventory pressure on complete machines and components, channel replenishment demand is expected to increase month by month, thereby driving the second quarter's notebook computer shipments to 37.63 million units, an increase of 11% quarter-on-quarter, but still a decline of 18% from the same period last year.
In the domestic market, commercial market shipments fell 27% year-on-year in the first quarter of 2023, with demand from small and medium-sized enterprises being particularly weak. Although shipments in the consumer market have improved slightly, they still fell sharply by 21% year-on-year. Canalys analyst Emma Xu analyzed: “Small and medium-sized enterprises are still facing the dilemma of tight budgets, and given the current economic situation, many companies will also postpone spending on equipment. Since the first quarter, China's overall consumer spending has been relatively strong, but it has mainly been concentrated in areas such as tourism and hotel accommodation, and has not been used to purchase new computers.”
China's desktop and notebook computer shipments in the first quarter of 2023
In the first quarter of 2023, Lenovo still ranked first among Chinese PC manufacturers, but its shipments in the first quarter of 2023 fell 24% to 3.3 million units; Huawei's PC shipments increased by 34% to nearly 1 million units, ranking second; HP, the third-ranked company, had a smaller decline in shipments of 7%; Dell had the largest drop in PC shipments among the top five manufacturers in China, a decrease of 45%, ranking fourth; Asus ranked fifth with shipments reaching 700,000 units.
Recovery expected in the second half of the year
Although the short-term market performance of notebook computers is not satisfactory, some positive signs can still be seen, indicating further recovery in the second half of the year.
Canalys analyst Ishan Dutt said: In the long run, the growth of the PC market is strongly guaranteed because the overall shipments in the market have reached a higher level than before the epidemic. As the global economy begins to recover in 2024 and beyond, the larger user base after the epidemic, the demand for replacement brought about by the transition to Windows 11, and the renewal and new needs triggered by digital education will become key driving forces.
On May 17, Lenovo Group Chairman and CEO Yang Yuanqing also said at Lenovo's 2023 Global Suppliers Conference: “Although PCs are undergoing some inventory adjustments, the actual demand reflected in activations is much better than shipments. I believe that the PC downturn is close to the bottom, and PCs may resume growth as early as the second half of 2023.”
The government and large enterprises are expected to give priority to driving the recovery of PC demand. However, as customers are more cautious in spending in the short term, manufacturers need to adjust their products accordingly, add services, and even provide customers with more choices in financing payments in order to gain more opportunities.
In terms of overseas markets, as we enter the second quarter of 2023, the inflation rate has dropped below 5%, the business market is improving, and demand for personal computers will pick up in the second half of this year. The report shows that the activation rate of end-user devices is relatively high, which indicates that the clearance of high inventory is coming to an end. When the inventory returns to health, shipments will usher in a wave of growth. In addition, as students return to school after the holidays, demand in the education field will also increase. Entering 2024, Windows 10 upgrades will also become one of the important reasons for device updates.
The impact of the short-term slowdown in demand, market saturation and elevated inventory levels has affected all end-market segments. However, a recent survey by the Reserve Bank of India (RBI) showed an upward trend in consumer confidence and improved views on the overall economic situation. The resumption of long-suspended education and public sector tenders in June will also help boost shipments in the second half of the year. All these signs point to a recovery in the market, although it is still in a downturn.
However, affected by factors such as the sluggish recovery from the epidemic, the expanding impact of inflation, and corporate spending cuts, TrendForce predicts that global notebook computer shipments in 2023 will inevitably decline, with an estimated drop of 13%.
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