The PC market has been struggling for years, but a new report by Morgan Stanley suggests that it has now hit its lowest point in two decades. The report, shared with investors on Tuesday, predicts that shipments in 2023 will fall to 249 million units, a year-on-year decrease of 12.5%. This is due to weak consumer demand, a sharp decline in corporate demand, and a weak US and European economy. Additionally, there has been an increase in global channel inventory, which has contributed to the decline.
PC ASPs expected to decline
Morgan Stanley predicts that PC average selling prices (ASPs) will decline 3% year-over-year due to lingering inflationary pressures and a positive mix shift. This means that the total deal value will fall to $206 billion in fiscal 2023, 26% below the peak of $279 billion in 2021. The weaker shipment expectations and lower average selling prices are the main reasons for the decline.
Apple is a potential stock
While the PC market is struggling, Morgan Stanley sees Apple as a "potential stock" among computer manufacturers. In fact, Apple is the top choice among global PC OEMs, according to the report. Apple's price target increased the most at 15%, followed closely by Dell with an 11% increase. However, Asus and Acer are expected to decline by 40% and 43%, respectively.
Implications for the industry
The decline in the PC market has implications for the entire industry. It suggests that consumers are less interested in buying PCs and are instead opting for other devices like tablets and smartphones. This trend is expected to continue as more people use their mobile devices to work and play. As a result, PC manufacturers will have to adapt to the changing landscape if they want to remain relevant.
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