Business News

PC Shipments See Record Plunge in Q3—What That Means for Apple, AMD, Intel and Others

Distressed Patriotic Flag Unisex T-Shirt - Celebrate Comfort and Country $11.29 USD Get it here>>


PC market slackness that was hinted at by Advanced Micro Devices Inc., when it preannounced last week, has been confirmed by a new report that showed a sharp decline in shipments in the third quarter.

What Happened

Worldwide PC shipments plunged 19.5 percent year-over-year in the third quarter, preliminary results released by market research firm Gartner showed. This marked the steepest decline since the firm began tracking the PC market in the mid-1990s and was the fourth consecutive quarter of year-over-year drop, it said.

“This quarter’s results could mark a historic slowdown for the PC market,” Mikako Kitagawa, director analyst at Gartner, said. The weakness seen in the third quarter was largely due to high inventory, given the weak PC demand in both the consumer and business markets, he said, adding that supply chain constraints have eased.

The analyst also noted that back-to-school sales were disappointing despite massive promotions and price drops, as many consumers had purchased new PCs in the last two years. Businesses also reduced spending due to geopolitical and economic uncertainties that made IT spending more selective.

Regionally, Europe, the Middle East and Africa were the worst hit with a 26.4 percent decline, with the shuttering of Russia operations by vendors also contributing to the weakness. The PC market in the U.S. fell 17.3 percent, and that in the Asia-Pacific region, excluding Japan, declined 16.6 percent, mainly due to slower shipments in China.

Apple, Dell Grow Share

Dell Technologies Inc. and Apple Inc. were the only vendors among the majors that gained market share relative to the year-ago quarter. All vendors experienced year-over-year declines, with HP Inc., Lenovo Group Limited, and Acer seeing shipments falling by over 20 percent each.

Shipments of Apple and Dell fell 16.6 percent and 5.8 percent, respectively.

Benzinga’s Take

Apple held up relatively better than others in terms of unit shipments. KeyBanc Capital Markets analyst Brandon Nispel said in a recent note Cupertino could be a beneficiary of higher average selling price due to the mix shift in iPhone sales. The relative hit to Apple could be more modest, given expectations of fairly solid volume and higher ASP.

AMD recently lowered its third-quarter revenue guidance by about 16 percent but reiterated strong performances by its Datacenter and Embedded business. With the bad news now in the rearview and the stock already reflecting the setback, a further sharp downside in shares is unlikely, unless there are issues with AMD’s other business segments.

Intel Corporation, which is on a turnaround following execution issues, could see its fundamentals suffer, according to KeyBanc. Analyst John Vinh said the weakening PC demand and softer data center demand in enterprise/China were to some extent reflected in the chipmaker’s prior guidance. The situation has worsened significantly from when Intel reported last, he added.

By Shanthi Rexaline

© 2022 The Epoch Times. The Epoch Times does not provide investment advice. All rights reserved.

Benzinga

Follow



Source link

TruthUSA

I'm TruthUSA, the author behind TruthUSA News Hub located at https://truthusa.us/. With our One Story at a Time," my aim is to provide you with unbiased and comprehensive news coverage. I dive deep into the latest happenings in the US and global events, and bring you objective stories sourced from reputable sources. My goal is to keep you informed and enlightened, ensuring you have access to the truth. Stay tuned to TruthUSA News Hub to discover the reality behind the headlines and gain a well-rounded perspective on the world.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.