The global PC market is demonstrating signs of a robust recovery, with a 1.9% rise in shipments in the second quarter of 2024 compared with the prior-year quarter's level, as per the latest data compiled by Gartner, Inc. IT.
This marks the third consecutive quarter of year-over-year growth, signaling a positive turnaround after registering a decline for eight back-to-back quarters. The independent research firm’s latest data highlights several factors driving this resurgence and provides insights into the future of the market.
Stabilized Growth and Market Recovery
The fact that the shipments increased to 60.6 million units in the second quarter of 2024 suggests that the PC market is stabilizing. With a sequential improvement of 7.8% from the first quarter, inventory levels are returning to normal, indicating a balanced supply chain. This stability is crucial for the market’s continued recovery, especially as major platform updates and technological advancements are anticipated in the near future.
Computer - Mini computers Industry 5YR % Return 
Computer - Mini computers Industry 5YR % Return
Vendor Performance and Market Share
The rankings of the top six PC vendors remained unchanged from the previous year, with most showing positive year-over-year growth, per the Gartner report. Lenovo Group Limited LNVGY led the market with a 24.4% share, followed closely by HP Inc. HPQ at 22.6%. Lenovo and HP Inc. registered a year-over-year increase of 3.5% and 1.7%, respectively, in the second quarter.
Dell Technologies Inc. DELL, despite a slight decline of 2.4%, maintained a significant presence with a 16.7% share and retained its third spot among major vendors. Apple Inc. AAPL, Acer and ASUS reported substantial growth, with Apple achieving a notable 13.1% increase in shipments, and Acer and ASUS registering growth of 11.2% and 11.7%, respectively. With a market share of 9%, Apple continues to be the fourth-largest PC vendor globally, followed by Acer and ASUS, with a market share of 7.3% and 7.1%, respectively.
Regional Insights
Different regions exhibited varied performance, with the U.S. market showing the highest shipment volume since the third quarter of 2022. Per the data compiled by Gartner, the U.S. market grew 3.4% year over year, driven by strong sales in government and education sectors, and a gradual increase in business PC demand.
HP led the U.S. market with a share of 27%, followed by Dell, Lenovo and Apple, which have markets of 25.2%, 17.7% and 12.8%, respectively. Acer and ASUS ended the second quarter with a market share of 6.9% and 2.8%, respectively.
In the EMEA region, the market grew 4.8% year over year, marking its third consecutive quarter of growth. This region is showing signs of improvement from the previous declines and returning to seasonal trends. The Asia/Pacific market, however, saw a decline of 2.2% year over year, primarily due to a weak performance in China. However, this was partially offset by growth in other parts of the region, particularly in India and mature Asia/Pacific markets.
Technological Advancements and AI Integration
Gartner, in its report, stated that the PC industry is pushing forward with significant technological advancements, particularly in the realm of artificial intelligence (AI). The introduction of AI PCs, equipped with Neural Processing Units (NPUs), represents a significant innovation. These devices are expected to enhance computing capabilities by providing advanced AI functions directly on the hardware.
The release of the first Arm-based Windows AI PC at the end of the second quarter of 2024 marks a milestone. Gartner pointed out that this development is likely to intensify competition in the PC market and pave the way for greater adoption of Arm processors in Windows devices. However, the demand for AI PCs has been slow as consumers are still evaluating the tangible benefits of these advanced features.
Challenges and Outlook
Despite the positive trends, the PC market faces several challenges that could impact its recovery. Inflationary pressures, economic uncertainties and potential geopolitical tensions pose risks to market stability. Additionally, the high cost of new technological innovations and the initial slow uptake of AI PCs could hinder immediate growth prospects.
Nevertheless, the overall outlook for the PC market remains optimistic. The continued digital transformation across industries, coupled with the increasing importance of remote work and online learning, is expected to sustain demand for PCs. As manufacturers continue to innovate and adapt to evolving consumer needs, the PC market is well-positioned for sustained growth.
Conclusion
The 1.9% increase in PC shipments in the second quarter of 2024 marks a positive shift for the industry, reflecting a stabilizing market and return to growth. Driven by rebounding demand in key segments, technological advancements and improved supply-chain conditions, the PC market is on its way to recovery. While challenges remain, the long-term prospects for the industry are promising, making it an exciting space to watch for investors.
Of the leading vendors, Dell sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Meanwhile, Apple and Lenovo have a Zacks Rank #2 (Buy) each, while HP carries a Zacks Rank #3 (Hold).
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