Laptops lose pandemic thrust amid slow consumer demand

The pandemic-led shift to remote work, which fueled massive demand for PCs and laptops in the last two years, has started to fade. According to analysts and industry experts, the demand is expected to decline further due to a slump in consumer demand driven by inflationary pressure. This in turn will force brands to cut prices in consumer laptops and offer discounts or bundling offers to drive commercial deals. 

“PC refresh happens in cycles. We are past the highest cycle which was during covid-19. That sort of growth cycle will not happen again. The double-digit decline will continue for the next 2-3 quarters,” said Tarun Pathak, research director at Counterpoint Research. 

PC shipments in India fell by 11.7% year-on-year (YoY) in the Q3 2022, the first drop after eight consecutive quarters of growth, according to data published by research firm the International data Corporation (IDC) in November.  Navkendar Singh, associate vice president, Devices Research at IDC, noted that brands will be forced to reduce prices of existing inventories in order to generate demand.

“Businesses too are holding back some spending,” said Ranjit Atwal, senior director analyst at Gartner. Enterprises and businesses buying employees laptops for hybrid or remote work was one of the main drivers for the market in the last eight quarters.

To be sure, experts believe that growth from B2B will return later in the year. “You might see a lot of B2B type bundling offers like back to school or work. Positioning of PCs will change and will be more B2B oriented. Consumer segment will remain under pressure as we are past that covid-induced demand curve,” said Pathak.

“The 2020-21 growth levels are not sustainable. Though shipments will continue to fall, it will not go back to the pre-pandemic lows,” said IDC’s Singh. 

To be sure, brands aren’t giving up just yet either. Sudhir Goel, chief business officer, Acer India, said that PCs are still under penetrated in India as compared to mobile phones. “Hence, there is still a lot of potential for PCs to grow with segments like gaming, government, BFSI, and first-time buyers,” he said.

Counterpoint’s Pathak added that premium laptops, including Apple’s MacBooks, will remain insulated from the slump in demand. He also said that the dip will not impact India’s IT hardware manufacturing plans, a reworked version of which is expected to be announced at the upcoming Union Budget 2023.