PC Sector StrugglingAt my household, no one uses a personal computer (PC). There is the occasional use of a laptop, but even these mobile devices are becoming cumbersome to handle. In fact, the dominant devices of choice in my household are tablets, phablets (large smartphones with the capabilities of a tablet), and smartphones. These devices are small, light, mobile, and increasingly powerful enough to work on, whether it’s for work or for school.
What is occurring in my household is also happening across America and, in fact, around the world, according to my stock analysis.
Users are increasingly demanding smaller and more powerful devices. My stock analysis indicates this has been the trend, and it’s not going to change anytime soon, despite many efforts by the PC makers.
Dell Inc. (NASDAQ/DELL) was playing around with a hybrid laptop/tablet combo. It was pretty gimmicky, and it was just a failed attempt to override the tablet, based on my stock analysis.
Microsoft Corporation (NASDAQ/MSFT) recently launched PCs and laptops with its touchscreen “Windows 8” platform, but they’ve failed to catch on so far. Having played with these touchscreen computers, I still prefer the feel and portability of the tablet. I think the majority of users are in sync here, based on my stock analysis.
Bob O’Donnell of International Data Corporation (IDC) said, “At this point, unfortunately, it seems clear that the Windows 8 launch not only failed to provide a positive boost to the PC market, but appears to have slowed the market.” (Source: “PC Shipments Post the Steepest Decline Ever in a Single Quarter, According to IDC,” International Data Corporation web site, April 10, 2013.)
My stock analysis suggests industry statistics show a horrible situation for the world’s top PC makers. As I have said in the past: the era of the PC is dead. (Read “Michael Dell Finally Gets It!”)
In the first quarter of 2013, the worldwide shipment of PCs plummeted 13.9% year-over-year and was much worse than the IDC forecast of -7.7%. According to IDC, it was the fourth straight quarter of declines on a year-over-year basis, and you know this is not good.
Take a look at the chart of the PC shipments for the top five companies in the sector below. Only Lenovo Group Limited managed to avoid a decline, based on my stock analysis.
Hewlett-Packard Company (NYSE/HPQ) saw its PC shipments plummet 23.7%, while Acer Inc. reported a dismal 31.3% year-over-year decline in shipments.
PC Shipments Q1 Change chart
Chart copyright © Lombardi Publishing Corporation, 2013;
Data source: International Data Corporation web site, last accessed April 12, 2013
The reality is that the writing is on the wall, and it has been since Apple Inc. (NASDAQ/AAPL) first launched its “iPad” in 2010, based on my stock analysis.
Since then, we have seen an explosive demand for mobile devices, and this, in my view and the opinion of many others, will continue to accelerate and inevitably kill the PC sector.
As I have said, the PC makers need to come up with a “Plan B,” or it could be lights out in as early as a few years.
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