In Q4 2008, worldwide PC sales registered the first decline in six years due to unfavorable global economic conditions, which reduced the consumer spending.
According to IDC, global PC sales registered a decline in fourth quarter for the first time in past six years, feeling the heat of economic recession. The PC purchases were affected more than expected.
In Q4 2008, PC shipments fell by 0.4% to 77.3 Million Units from Q4 2007. It dropped 2.5% from Q3 2008. This downfall was preceded by six years of increasing sales, out of which the last five years aggregated to an increase of about 15%. The fourth quarter shipments of netbooks (mini-laptops) reached five million units, taking the total sales figure to 10 Million Units in 2008.
Moreover, as compared to the 40% growth in laptop shipments during Q1-Q3 2008, the growth reduced to half (20%) in Q4 2008. The shipments of desktop computers also slid down by 16% during the fourth quarter of 2008 over the same period last year, following a minute decline in the earlier part of the year.
The major factor that put a brake on the growth of global PC market was the tough economic condition, including decreasing prices of stocks and homes, as well as difficulty in obtaining credit from banks. Despite offering portables at lower cost as well as holiday promotions, there was very less that vendors could do to check the decline.
PC spending had shrunk at a pace faster than expected due to the factors that have cut the overall retail spending in last six months of the past year.
The comparatively inexpensive netbooks, having limited features, appear to be a sign of hope for PC manufacturers. However, they have to compromise on their profit margins as these small notebook computers are relatively less profitable than desktop PCs.
According to a Research Analyst at RNCOS, “Global PC shipments plunged in Q4 2008 due to recession. Well, coming months are expected to bring some relief as sales may rise a little, but the majority of consumers will preferably wait for the economy to recover. Meanwhile, vendors are more concerned about the lack of corporate spending on IT equipment as budgets have been frozen and thus, are unlikely to refresh PCs in near term.
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