Finally, PC Sales Bounce Back for a Little While

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By Douglas A. McIntyre Published
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After years of anxiety that PC sales would continue to be destroyed by the emergence of the smartphone, something unexpected has happened. PC shipments have started to recover and traditional PC sales have stabilized. Some of the credit goes to Windows XP upgrades, but the overall economy has played a role as well. Either way, the industry’s destruction has been halted, or at least delayed. The trend may not last more than a year or two, however. Smartphone sales continue to rise relentlessly.

According to research firm Gartner:

Worldwide combined shipments of devices (PCs, tablets, ultramobiles and mobile phones) are projected to reach 2.4 billion units in 2014, a 4.2 percent increase from 2013.

“2014 will be marked by a relative revival of the global PC market,” said Ranjit Atwal, research director at Gartner. After declining 9.5 percent in 2013, the global PC market (desk-based, notebook and premium ultramobile) is on pace to contract only 2.9 percent in 2014.

Then in 2015, Gartner forecasts, shipments will rise again to 2.6 billion. Next year, 316.7 million traditional PCs are forecast to be shipped, up from 308.5 million this year. This improvement comes as mobile phone sales lose some of their luster. Sales of these devices are expected to go from 1.863 billion this year to only 1.947 billion next. However, the mobile phone manufacturers can take some comfort that smartphone sales make up an ever larger portion of their market. And these smartphones usually have higher prices and better margins. Gartner reports:

Sales of mobile phones are expected to reach 1.9 billion units in 2014, a 3.1 percent increase from 2013. Sales of smartphones, which exceeded those of the rest of the market in 2013, will continue to do well, and Gartner estimates that smartphone sales will represent 88 percent of global mobile phone sales by 2018 — up from 66 percent in 2014.

The year 2018 may seem a long way away, and Gartner did not provide a forecast for PC sales then. But for these PC companies, 2018 will come too soon if they cannot figure out a way to blunt the customers that smartphones continue to steal from them. Upgrades to Windows XP and replacement of older machines will only last so long.

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Photo of Douglas A. McIntyre
About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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