PC Shipments Ride Supply Roller Coaster

Article By : George Leopold

Unmet demand grows as holiday shoppers place more strain on frayed supply lines.

Anyone shopping for a home appliance inevitably realizes their preferred brand is likely out of stock, forcing consumers to settle for what they can find, where and when they can find it.

The same is true for consumer electronics. Ongoing supply chain disruptions are preventing PC makers, for example, from meeting steady demand for notebooks, desktops and workstations. While the sector has registered a 9-percent compound annual growth rate since the onset of the pandemic, computer vendors remain unable to meet demand expected to spike again during the holidays.

With container ships parked for days at U.S. ports on the east and west costs, clogged inland logistics networks are creating backlogs for PC vendors, according to Ishan Dutt, a senior analyst at Canalys.

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Manufacturing slowdowns in Asia have been “compounded by a massive slowdown in global transportation with freight prices and delay times skyrocketing as a number of industries compete to meet unfulfilled demand,” added Dutt, who expects the PC supply shortfall to persist well into 2022. Meanwhile, a surge of holiday orders is unlikely to be fulfilled.

That reality is prompting calls for manufacturers to diversify production and distribution as a way of meeting persistent demand and avoid leaving future revenues on the table.

Canalys reports that the inability to pivot has extracted a penalty, with annual growth declining to just 5 percent in the third quarter despite steadily growing demand. The market tracker estimated quarterly shipments of notebooks, desktops and workstations totaled just over 84 million units during the last quarter.

Lenovo replaced HP as the current PC market leader, with shipments up 2.5 percent on a quarterly basis. HP failed to sustain market expansion in the previous quarter, with annual growth declining by 5.7 percent. It was the only PC vendor registering a decline during an relatively third quarter.

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HP’s loss was Dell’s gain. The No. 3 PC vendor saw quarterly shipments soar 26.7 percent. Meanwhile, Apple’s growth rate jumped 14.4 percent on a quarterly basis. Given demand, those totals would presumably have been even higher if not for supply chain and logistics bottlenecks.

As supply chain disruptions persist, Canalys predicts market drivers like education and entertainment will be supplanted by new employment patterns. “Hybrid work models will be an important part of the new normal post-Covid-19 and will require PC vendors to enhance product portfolios and go-to-market strategies, as faster processors, better cameras and anytime-anywhere connectivity take center stage,” said Rushabh Doshi, research director at Canalys.

This article was originally published on EE Times.

George Leopold has written about science and technology from Washington, D.C., since 1986. Besides EE Times, Leopold’s work has appeared in The New York Times, New Scientist, and other publications. He resides in Reston, Va.

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