PC market slumps in Q1 but worse yet to come

Canalys claims tablet shipments are shrinking too

Global shipments of PCs fell seven per cent annually in Q1, according to Canalys, which claims the market's performance will get worse in the second quarter.

In Q1, PC shipments – including tablets – fell seven per cent annually to 115.7 million units, thanks to a variety of factors including exchange rates prompting rising unit prices.

"These challenges, combined with a softening of demand as Windows 10 draws nearer along with Microsoft's free upgrade plans, means PC market declines will be greater in the second quarter than they were in the first," said senior Canalys analyst Tim Coulling.

In Q1, desktop shipments were hardest hit, down 13 per cent annually, with the slump affecting all global regions. And the picture was bleak for tablets too - over the same period, shipments fell nine per cent to 45.6 million units.

"The rapid growth in the tablet market has caused markets in western Europe and North America to become highly penetrated and shipment volumes have started to decline," adding Coulling. "Growth in these markets now relies on consumer replacements or increasing business purchases, neither of which looks likely to pick up significantly in the coming quarters."

The only glimmer of light for the PC market shone on the notebook segment where shipments fell only four per cent annually.

But Canalys analyst Rushabh Doshi said channel inventory was worrying in the segment.

"The notebook category faces significant challenges for the rest of the year as Microsoft has restricted the Windows with Bing programme to notebooks with sub-14in screen sizes," he said. "Channel inventory has been building since Microsoft announced the change and this will need to adjust before significant orders return. Any price rises for Windows notebooks will play into the hands of Google, which is making strides in improving Chrome OS for both consumers and businesses."