Gartner predicts PC market to bottom out in 2016 and return to growth in 2017

Gartner has released their smart device shipments forecast for 2015 to 2018, and they predict the long slide in PC sales should finally bottom out this year, with the ecosystem returning to growth in 2017, largely due to the rise in sales of premium ultra-mobile PCs such as the Microsoft’s Surface Pro, Lenovo Yoga 3 Pro and Apple’s MacBook Air and the adoption of Windows 10 in the enterprise segment.

For the PC market to stay on pace for flat growth in 2017, business spending needs to flourish, they note.

“The inventory of Windows 8 PCs should have been cleared, and large businesses in mature markets are now looking to move to Windows 10 through 2018,” said Ranjit Atwal, research director at Gartner. “In addition, more affordable hardware and increasingly available virtual reality content (such as games, stories and other entertainment) will enable consumer PC buyers to upgrade in order to experience immersive offerings.

While traditional PCs continue to decline premium ultra-mobiles will continue to show strong growth.

“We expect premium ultra-mobiles will start benefiting from the collective performance and integration of the latest Intel CPU platform and Windows 10,” added Mr. Atwal.

The PC market as a whole is expected to exhibit an 8 per cent decline in 2016, as the installed base bottoms out and replacement cycle extensions halt,  Gartner noted.

“The effect of currency depreciation on the market is diminishing,” added Mr. Atwal. “The second quarter of 2016 was the first since the second quarter of 2015 least impacted by currency depreciation.” Regions such as Western Europe, where the Euro depreciated significantly in 2015 and PC prices increased, finally showed flat market growth (-0.9 percent) in the second quarter of 2016. This follows four consecutive quarters of decline.
If this situation prevails it means that PC sales will bottom out in 2016. However, the PC market in Western Europe remains difficult following the Brexit vote.