PC market records brutal drops in Portugal. Manufacturers support investment retraction – Computers
After two years of extraordinary growth in the PC market, the numbers for the second quarter show a break that Francisco Jerónimo, vice president of Data & Analytics at IDC Europe at IDC, classifies as brutal. “Sales in Portugal fell by 34% in laptops and desktops”, explained to SAPOTEK, units
The corresponding numbers the end of the education program, but also a new phase of need for companies and the last two years have reinforced investment in this area due to the permanence of professionals in telework following the COVID-19 pandemic, which imposed work from home or hybrid distance models, and as distance classes, with the Government’s investment in the Digital School program that gave rise to the purchase of thousands of portable for students and teachers.
“The main drop comes from the education area, where sales fell by 86% with the equipment purchase programs ending”, justifies Francisco Jerónimo. But consumption also fell by more than 14% and sales in the small and medium-sized companies segment are also affecting the effects of retraction in investment, with drops of 32%.
Another relevant element is the rise in the average price of computers, above 20%. “Manufacturers focused on producing more expensive equipment”, points out the vice president of Data & Analytics at IDC Europe, noting that in the last two years there was a lack of products to respond to demand, and this also had an effect on the suspension of promotion campaignsat the same time that their consumers can value the quality of their equipment more and invest more to have a better product.
“Until the end of the year, we will go through price drops and tests to help manufacturers get rid of shares”, anticipates Francisco Jerónimo.
In terms of numbers, in the second quarter, 176 thousand PCs, laptops and desktops were sold in Portugal, when in the first months of the year the number exceeded 465 thousand and in the last quarter of 2021 to 606 thousand. Lenovo led the sales figures with 37.9% of the total, followed by HP with 19.9% and Asus with 9.5%. Dell with 8.7% and Apple with 3.8% complete a top 5 that this quarter is much more unbalanced than usual, since in the last periods of analysis HP was several times in the first position, which has now given way to a Lenovo.
A retreat to normalcy?
Pedro Coelho, PC category manager at HP Portugalrecognizes the change in the trend in the second quarter but recalls that “the market has been recovering to the levels of demand recorded in pre-pandemic periods, namely in 2019” and that although this is reflected in negative rates of 15 to 20% in units, relative to 2020 and 2021
“It should be noted that demand remains stronger than in the years prior to the pandemic”, says Pedro Coelho
The unparalleled growth in the last two years, driven by the transition to remote work and distance learning, has helped consumers to equip themselves. The economic conjuncture, with war and future inflation generating more uncertainties regarding personal budgets, made budgets known and known as compensated.
On the business side, there is a positive note and Pedro Coelho recognizes that in medium and large companies and in public organizations there is stabilization. Only as SMEs do they have the greatest negative impact due to the lower investment capacity.
The same trend is highlighted by Carlos Cunha, commercial director of Dynabook Portugalwhich recognizes that despite seeking to continue to exist in the corporate segment, in order to equip as teams for hybrid work, and therefore the expectation is positive, but “in perspective of the execution of the RR program well”.
In the case of Huawei sales are positive and not market trend numbers. Yin Lingyun, Product Manager of the Consumer Unit Laptops Category at Huawei Portugal refers to continued sales growth and an 18% rise y/y, with a market share of almost 9% in notebooks. Still, the lack of components and logistics problems also had an impact, but the official says that Huawei is different.
“Although with the war and the end of the pandemic, consumers were not prioritized investing in technology, the truth is that the Huawei has continued to grow and mark its position in the strengths that set it apart from other brands in the market.”, defends Yin Lingyun.
Microsoft Portugal also says that they have together with partners to mitigate a significant part of these negative factors. “In the business market, the evolution of Surface devices has been solid, and we recently ended the fiscal year growing in double digitson top of an equally double-digit growth in the previous year”.
“The transition to work models implemented for Microsoft’s adaptation that today’s worker needs mobility and productivity from anywhere,” explains João Moura, leader of the Surface business segment at Microsoft Portugal.
Higher prices and more demanding consumers
Buying trends are also accepted by the profile of Portuguese consumers. Carlos Cunha says that “Portuguese buyers will try to achieve greater portability between capacity, performance and build quality. Contrary to what happens with other types of equipment, the purchase cycle for new computers is longer than smartphones, for example, so the Portuguese have to maximize these three points when choosing”.
As Dynabook is focused on B2B, inheriting only the Toshiba brand, the commercial director admits that the average price is above the market and which in recent months has increased by around 3%. The most sold line is the Tecra range and in general consumers are looking for equipment that guarantees a minimum useful life of 3 to 5 years.
Also at HP, personal growth has increased, as a result of work and especially in recent years it has reinforced the importance of the PC as a tool for entertainment and socialization. As a consequence, the demand on the characteristics of the high range of media and demand has increased”, says Pedro Coelho.
The values also depend on external circumstances, over which manufacturers have no direct influence, including the evolution of the war in Ukraine, with consequent impacts on the macroeconomic environment, and, in particular, an appreciation of the euro exchange rate.
The HP official also recognizes a change in behavior and greater customer demand. “The last 2 years, and in particular the periods of confinement, have considered us that PCs are not all the same. We have the importance of having a PC with an integrated resolution camera that allows us to have a good remote presence in front of friends, colleagues or even clients.”, he says.
“We are with PCs, we listen to the same music at the same time that we tolerate less quality while we are taking a photo and we demand sound when we are streaming or when we need the PC to eliminate the noise that we are watching in a series we focus on meeting with our project team ”, adds Pedro Coelho, saying that this behavior at a personal and business level.
ONE security issue is more valued in the business market, as underlined by João Moura. An adaptation to work, integrated in lighter and easily transportable formats, which combine in this vision of shapes. “We also see more and more company managers looking at investment as a complete workstation (hardware and cloud management) and not just physical characteristics versus price”, justifying the responsibility for the Surface business segment. from Microsoft Portugal.
High expectations for the end of the year?
After a more valued market, a downward trend in prices towards the end of the year is cited by Francisco Jerónimo from IDC, who anticipates campaigns by manufacturers to release stocks.
Yin Lingy already identifies a price reduction that accompanies the back-to-school campaigns, one of the most important moments of the year for the sale of PCs. “We have some campaigns in place to highlight this data, ranging from the price reduction (as is the case of the HUAWEI MateBook D 15 i3, which is currently at around €479 with a Bluetooth mouse and backpack offer) to the offer product (which in the case of the brand new Huawei MateBook 16s is the HUAWEI Display 23.8 monitor)”, he justifies. The values below the usual average sale price of Huawei are between 500 and 600 euros.
No business market expectations are more positivewith the intention of investing in the finance and resilience project company (PRcup)
João Moura admits that the perspective is to continue to grow at double digits in line with Microsoft Portugal. “We continue to see a growth trend in this configuration of our fiscal We are still in a calmer phase due to the summer holidays. The return to work, a need to reinforce the park once again installed, which already has a lot of transformation happening in companies with regard to the way of working with the resources provided to employees so that they can function in their best way”, says.
Likewise, Carlos Cunha has a positive vision for Dynabook Portugal.
“Honest waiting for the digital transformation program in perspective”, Carlos Cunha.
The trend will still have to be guaranteed, not least because thehe news for the economy is not encouraging and anticipates a further retraction in consumptiondespite the recognized need of consumers and companies for the renovation of equipment parks and the greater demand with the design and quality of materials.