PC sales expected to decline

It would be their first drop in more than a decade.

By Benzinga Oct 11, 2012 11:49AM

Image Source, Getty ImagesBy Louis Bedigian

After 11 years of growth, sales of PCs -- including notebooks, netbooks and desktops -- are expected to decline.

This revelation comes from three different researchers. In a report by IHS iSuppli (IHS), the researcher showed that worldwide PC shipments will contract this year by 1.2% to 348.7 million units. In 2011, 352.8 million units were shipped.

In another report, IDC found that worldwide PC sales declined by 8.6% in the third quarter. In the United States alone, shipments declined by 12.4%. Gartner (IT) published similar results.

"There was great hope through the first half that 2012 would prove to be a rebound year for the PC market," Craig Stice, a senior principal analyst for computer systems at IHS, said in a company release. "Now three quarters through the year, the usual boost from the back-to-school season appears to be a bust, and both AMD and Intel's third-quarter outlooks appear to be flat to down. Optimism has vanished and turned to doubt, and the industry is now training its sights on 2013 to deliver the hoped-for rebound. All this is setting the PC market up for its first annual decline since the dot-com bust year of 2001."

Gartner concurred with that assessment.

"Retailers were conservative in placing orders as they responded to weak back-to-school sales," said Mikako Kitagawa, a principal analyst at Gartner. "By the end of September, retailers were focused on clearing out inventory in advance of the Windows 8 launch later this month. On the professional side, there was minimum impact from Windows 8 in the quarter because the professional market will not adopt Windows 8 PCs immediately after the release."

"PCs are going through a severe slump," added Jay Chou, a senior research analyst with IDC's Worldwide PC Tracker. "The industry had already weathered a rough second quarter, and now the third quarter was even worse. A weak global economy as well as questions about PC market saturation and delayed replacement cycles are certainly a factor, but the hard question of what is the 'it' product for PCs remains unanswered. While Ultrabook prices have come down a little, there are still some significant challenges that will greet Windows 8 in the coming quarter."

Dell (DELL) and Hewlett-Packard (HPQ) are among the biggest companies enduring declines. In the third quarter, Gartner said, HP declined by 16.4% worldwide, while Dell dropped 13.7%. In the United States, the declines were even greater.

Domestically, Apple (AAPL) suffered as well. While the company released a brand-new version of the MacBook Pro and knocked $100 off the 13-inch MacBook Air, Apple still experienced a decline of 6.1%.

IDC's numbers are nearly on par with Gartner's, but there is one exception: IDC's research shows that Apple declined by 7%.

IHS did not provide any details regarding how individual corporations are performing.

Follow me @LouisBedigianBZ

More from Benzinga
Oct 11, 2012 4:32PM
As far as business goes almost everyone is experimenting/deploying some form of virtualization (Citrix, VMWare, HyperV) and then replacing the PC on the desktop with a thin client able to run Windows 7 and all the apps just fine.  Home PC's may go that way too once they can run a Windows 7 desktop from the cloud.  Gaming will be the last to convert but once 1gb fiber to the home becomes a reality they'll go the same way.  
Oct 11, 2012 4:28PM

......and in 1899 Literary Digest said the automobile would never catch on.

Oct 11, 2012 4:24PM
Tablet's aren't strong enough and wont be anytime soon. How is a tablet going to run a brand new game or render HD videos? 
Oct 11, 2012 4:20PM
PCs are on their way out. Soon afterward laptops will also be on its way out. The coming thing is the tablet. The company that can combine the tablet and cell phone together will probably have the market sewed up for a few years.
Oct 11, 2012 4:19PM
With consoles showing their age, PC Gaming is poised to gain ground.
Oct 11, 2012 4:16PM

Wait so if the article speculates the end of deskstop and laptop use, then what will there be next? Holographic computers that manifest from a wristband/bracelet that allows you type things like minority report? Or wait better yet a computer already linked up to your brain and if you think it, you can search it...Ghost in the Shell??


That would be wow, but umm I don't think I'll be around for another 300 years before that happens. I'll just stick to losing my vision on my 15.4 inch screen macbook pro :D. Yay!

Oct 11, 2012 4:04PM

PC's will be around for some time yet. If you need to do serious keyboard work, a pc or laptop is the way to go. I wouldn't try to write a large document or spreadsheet on a smartphone. You can watch Star Trek or play a video game on a smart phone or tablet, which is ok for young guys with eagle eyes. Us older guys need a lot larger screen. 


It depends on what your primary use of the electronics is. PC's will probably lose market share in the long run but it is far to early to pronounce their imminent death. Also like anything else the market is subject to fluctuations. Is anyone going to pronounce the smartphone dead if sales drop off?

Oct 11, 2012 3:51PM
You have to look at the economy as well. I just moved because my job went to Mexico 2 years ago. Not going into details but people are worried about upcoming changes if there are any. I don't see the PC becoming a thing of the past, just now people are a bit tighter on their cash and working with what works than dealing with the headaches of a new OS. It's always a hassle, I dealt with it with Vista till Windows 7 came out. It was a smooth move for Microsoft to cash in on something new that wasn't ready to be sold. It's just my opinion and you can take it for what it is... just an opinion. People are tired of buying something that is not "truly" tested before its offered for public sale. All I have to say is get it right before you offer it to the masses and quit scrambling to fix things and make everyone happy. Bottom line, you're never going to make "everyone" happy.
Oct 11, 2012 3:47PM
I imagine that people are just using their old ones longer.  A pad or phone does not work when you are on the computer all day for work.  I use 3 different computers  - a desktop at work (5 years old), a desktop (6 years old) and a laptap (7 years old) at home.  There is just no reason to keep buying new ones when the old ones work just fine. 
Oct 11, 2012 3:44PM

I've been gaming on the PC for over 10 years, there is just no reason to use anything else because nothing else is more powerful.  I've had two gaming laptops in the past, they worked well at the time because I was always on the move and had limited space.  These days I'm no longer on the move and I have plenty of space.  I run a powerful PC that plays the latest games on high settings and have dual monitors.


None of this is possible on a laptop, ipad or smart phone.  I can understant why people would think the PC is dying but for someone like me who doesn't have any use for an ipad or a smart phone, the PC is the only choice.

Oct 11, 2012 3:23PM
I imagine the I-clones are happy. Tisk,tisk
Oct 11, 2012 3:16PM
The PC market has simply been saturated over the past decade or so. I see many businesses and individuals who are satisfied with the performance of PC's seven or eight years old running their 32 bit mission critical Enterprise applications which still represent a substantial investment. And many of those 32 bit apps will not run on  64 bit OS. Even when there are 64 bit upgrades to these legacy apps, these businesses and individuals are hard pressed to shell out even more money for upgrades just because the industry dictates they must, not to mention the state of the economy. The 64 bit hype began just before the economy tanked and retailers, in their infinite wisdom, over inventoried on 64 bit machines/OS. And their not going to tell you that all of the apps your are running on your "old" 32 bit machine will no longer run on the new machine. They are only interested in eliminating inventory.
Oct 11, 2012 3:10PM
PC sales decline YES replaced by Tablets and Smartphones - NO WAY!
Oct 11, 2012 3:10PM
I stopped buying PC'S from companies like Dell and Hewlett-Packard and the other ones about 3 years ago. Now I build my own. So much better building your own rig. 
Oct 11, 2012 3:09PM
Sorry it's a typo. They meant Macs.
Oct 11, 2012 3:06PM

I'm sure there are a host of reasons for the soft sales numbers besides waning interest in the traditional desktop. The pads are big on cool and low on useful. Have you ever tried to write or edit a serious document on one? Ever try some serious photo editing on one? Ever try to repair or upgrade one? I think I'll keep my easily repaired and upgraded desktop, printer and 24" screen thank you very much!

Oct 11, 2012 3:05PM
reports of PC's imminent death are greatly exaggerated
Oct 11, 2012 2:57PM
It's declining, because they are lasting longer....?
Oct 11, 2012 2:48PM
A P.C won't be going away anytime soon because you can't be productive on a tablet/smart phone.  Yeah more people are buying tablets and smartphones to compliment their P.C purchases, however there is no way someone will write a 20 page document with an "APP" or on a screen that can be held in their hand. 
Oct 11, 2012 2:44PM

Well 12 million people play Warcraft on there pc!  ****

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