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Tim Green

PC Sales Tumbled in 2015

by Tim Green | Dun & Bradstreet Editor

January 21, 2016 | No Comments »

Lenovo Thinkpad laptop computerCompanies and consumers just aren’t that much into personal computers anymore.

PC sales continued to drop in 2015 as buyers maintained their preference for mobile devices or, in perhaps the best case for PC makers, put off purchases until they are absolutely necessary.

Market research firms Gartner and IDC, which count sales differently, agreed that fewer than 300,000 units were sold in 2015 — the first year that’s happened since 2008, Gartner noted.

Overall, Gartner pegged the sales decline from 2014 to 2015 at 8% and IDC put it at 9.8%.

Mikako Kitagawa, a Gartner analyst, said the PC market is going through a structural change that will reduce the number of PCs sitting on desks and laps in the next few years.

Even the introduction of Windows 10, the latest operating system from Microsoft, couldn’t slow the fall of PC sales. Nor did the release of several well-reviewed PCs bolster sales.

The analysts said that Microsoft’s decision to provide Windows 10 to PC users at no charge took some of the steam out of sales. Users preferred to get a “new PC experience” through software rather than hardware. However, Windows 10-inspired sales should pick up in 2016.

“Commercial adoption is expected to accelerate and consumer buying should stabilize by the second half of the year,” said Loren Loverde, VP of IDC’s Worldwide PC Tracker program.

He said that PC users can delay upgrades for only so long before security and performance issues prompt them to buy new PCs in 2016.

PC sales might even increase, according to IT managers surveyed by Spiceworks, a social network for IT workers. Spiceworks reported that IT managers expect their companies to increase purchases of desktop and laptop computers by 1%. What’s more, the IT managers thought other hardware purchases would be stable or decrease.  

PC makers will take any hint of stability in 2016 after all but one sold fewer units in 2015, IDC and Gartner reported. Lenovo continued to lead the pack with a nearly 20% market share, but its sales were off 3.6%. Sales fell 5.9% at both HP Inc. and Dell, #2 and #3, while #4 Acer Group’s sales tumbled 18%.

Apple was the outlier with a 6.2% increase in sales of its Macintosh computers in 2015. For perspective, the 20.7 million units the company shipped during the year were less than a third of Lenovo’s total.

The company’s alliance with IBM is one factor that propelled sales. The companies agreed in 2014 to outfit Apple iPhones and iPads with IBM’s business software. Subsequently IBM let its employees choose Macs or PCs. IBM said in October that about 30,000 of its employees have booted up MacBooks and that it continues to provide about 1,900 a month.

The acceleration of Apple MacBook sales indicates that there’s demand for “innovative, even premium-priced systems that put user experience first,” said IDC analyst Jay Chou.

PC sales might be a bit less gloomy in 2016 when Gartner and IDC forecast that sales will slow just 1% from 2015. They look for purchases that will allow users to get the full benefit from Windows 10. Also during the year PCs will run on a new, more powerful processor from Intel, the company’s first new chip for PCs in about two years.

Intel, which has suffered from the decline in PC sales, affirmed its commitment to the market.

“We will continue to drive innovation and differentiation in our core PC business,” Brian Krzanich, Intel’s CEO, told stock analysts in a call after the release of its 2015 financial report. “This business provides a foundation of IP (intellectual property) and a source of cash flow, but it’s not the sole driver of our growth.”

Intel, and other technology companies, are setting their sights and R&D dollars elsewhere in search of growth.

Intel is banking on increased revenue from its data center, memory, and the Internet of Things businesses. In 2015 the company spent $16 billion to buy Altera, which makes chips that can be reprogrammed after installation, to address those markets.

Tim Green has covered business, technology and science at newspapers and in higher education. At Hoover’s he covers computers and telecommunications. Follow him on Twitter.

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Photo by Wikimedia Commons user Elroygoh, used here under a Creative Commons license.

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