IDC Forecasts Steeper Drop In 2020 PC Sales Due To Coronavirus

The research firm reduces its forecast, with PC sales now expected to drop 9 percent this year.


The impacts from the spread of the novel coronavirus COVID-19 are expected to lead to a further drop in PC sales this year, research firm IDC disclosed on Thursday.

It was already looking to be a dismal year for global PC sales, with IDC previously forecasting a 6.8-percent drop--a result of "tougher year-over-year growth comparisons" from the end of the Windows 7 to Windows 10 transition.

[Related: Microsoft Cuts Revenue Guidance On Coronavirus Outbreak]

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However, with the coronavirus affecting both production and sales of PCs, IDC is reducing its forecast. PC sales are now expected to drop 9 percent in 2020 compared to last year, with the spread of COVID-19 "hampering supply and leading to reduced demand," IDC said.

The forecast includes both PCs and tablets. Total shipments are now expected to reach 374.2 million this year, down from the previous forecast of 380.2 million.

"Lost wages associated with factory shutdowns and the overall reduction in quality of life will further the decline in the second half of the year as demand will be negatively impacted," said Jitesh Ubrani, research manager for Worldwide Mobile Device Trackers at IDC, in a news release.

China, where the coronavirus outbreak has been focused, is a manufacturing hub for PC and components makers.

"Many critical components such as panels, touch sensors, and printed circuit boards come out of these impacted regions, which will cause a supply crunch heading into Q2," said Linn Huang, research vice president for devices and displays at IDC, in the news release.

IDC's reduced guidance follow an announcement from Microsoft on Wednesday, which said it no longer expects to achieve its revenue guidance for its current quarter as a result of the coronavirus epidemic.

Microsoft's personal computing segment, including its Windows OEM and Surface devices businesses, are the areas seeing an impact related to the outbreak, the company said.

There have been similar disclosures from device makers Apple and HP Inc.

Apple said last week that it no longer expects to achieve its revenue guidance for its current quarter as the coronavirus epidemic takes a toll on production and sales in China. Then this week, HP announced it has factored in an 8-cent impact to its earnings per share guidance for its current quarter.

Still, "we view the impact as temporary, with limited impact to our second half" from the coronavirus outbreak, HP CFO Steve Fieler said Monday during the company's quarterly call with analysts.

Global stock markets have plunged this week amid concerns over the growing number of coronavirus cases outside of China.

IDC sounded a slightly more hopeful note for 2021, however, stating in its press release:

Assuming the spread of the virus subsides in 2020, IDC anticipates minor growth in 2021 as the market returns to normal with growth stemming from modern form factors such as thin and light notebooks, detachable tablets, and convertible laptops. Many commercial organizations are expected to refresh their devices and move towards these modern form factors in an effort to attract and retain a younger workforce. Meanwhile, consumer demand in gaming as well as the rise in cellular-enabled PCs and tablets will also help provide a marginal uplift.