Study: PCs No Longer A Preferred Gift Item, As 2016 Shipments Decline For 5th Year In A Row

The downturn in PC market continued in 2016 as shipments declined for the fifth year in a row, according to estimates from research firm Gartner.

Gartner said 2016 worldwide PC shipments fell 6.2 percent to 269.7 million units. PC shipments have declined annually since 2012. For the fourth quarter 2016, shipments declined 3.7 percent to 72.6 million units.

"Stagnation in the PC market continued into the fourth quarter of 2016 as holiday sales were generally weak due to the fundamental change in PC buying behavior," Mikako Kitagawa, principal analyst at Gartner, said in a press release.

The decline shows that technology improvements and innovative form factors have not been sufficient to drive real market growth.

The Evolving Market

The analyst added that PCs are not a preferred gift item any longer, as consumers shift toward other items such as virtual personal assistants, speakers, virtual reality head-mounted devices and wearables.

That said, the top two vendors increased their global market share in 2016, with Lenovo Group Limited (ADR) LNVGY at 20.7 percent market share, followed by HP Inc HPQ at 19.4 percent. Apple Inc. AAPL saw its market share slip to 6.9 percent from 7.1 percent in the year-ago period.

In the United States, PC shipments fell 1.3 percent to 16.5 million units in the fourth quarter, with HP securing the top position with 29.9 percent market share. Apple put out somewhat better performance in the United States, with fourth-quarter market share rising to 12.8 percent from 11.8 percent.

Looking Forward

As such, Kitagawa expects the PC market to decline in 2017 too as the ongoing opportunities in engaged PC user market, the business market and gaming may not be sufficient to stem the decline.