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RETURN OF THE PC

US computer sales spiked in the rush to work from home

REUTERS/Stuart McDill
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Karen Ho
By Karen Ho

Global finance and economics reporter

The last thing the personal computer industry expected was to see a sales boost in 2020. Then the Covid-19 pandemic hit, closing down offices and schools around the world. Millions of people suddenly needed laptops to work from home and complete classes online.

Global computer sales shot up by 11% to 72.3 million units in the second quarter compared to the same quarter last year, according to preliminary estimates from IDC, a global market research company. The jump was even higher for the US, where sales grew by 14% to 21.4 million during the same period compared to the second quarter of 2019.

 

In a normal year, computer sales don’t swing by more than 5% to 7%, according to Jeriel Ong, an equity research analyst at Deutsche Bank. The industry had also seen its sales decline by almost 100 million units a year from their peak in 2009 and 2010, and prior to the pandemic, people in the industry had been generally skeptical about the possibility of growth. This year, they were expecting sales to be mostly flat or even negative after many companies upgraded their machines in 2019, just before Microsoft stopped support for its Windows 7 operating system.

Computer makers were caught off guard by the huge surge in demand for laptops, with many retailers and distributors struggling to keep up during the early period of the pandemic. Coronavirus-related shutdowns also affected production at many of the industry’s largest manufacturing facilities in China.

This led to some interesting buying choices. “We’ve seen cases where businesses are buying gaming notebooks, business are buying Chromebooks,” said Jitesh Ubrani, a research manager at IDC. “Consumers and students are buying devices they wouldn’t normally get for education. They were doing all this because they were the only devices they could get their hands on.”

Some consumers also used extra aid they got from the government to buy gaming computers, giving the industry a boost, according to Mikako Kitagawa, a research director at the research and advisory firm Gartner.

PC makers could continue to see coronavirus-related sales as the summer progresses. An increasing number of school districts and universities in the US have announced plans for online classes for the fall. Google has also announced that it will allow its staff to work from home until next summer.

The learn-from-home trend will particularly benefit low-cost Chromebooks, said Ong. These laptops—which use Google’s operating system and suite of programs—are often popular among students and school districts on a budget. “That naturally benefits those providers that have a Chromebook lineup, like HP,” said Ong.

However, industry analysts tell Quartz that even with all of these announcements, the growth in both commercial and consumer computer sales is expected to slow down for the rest of the year. Sales to state and local governments could also be affected by pandemic-related financial constraints.

“Basically everyone who has a notebook already has one at this point or will be getting one pretty soon,” said Ubrani. “The surge in demand won’t continue forever.”

Editor’s note: An earlier headline on this article highlighted the quarter-over-quarter increase in sales, which doesn’t account for typical seasonal factors. We removed the figure and updated the story to give a fuller picture of the data.

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