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The PC market is still shrinking and Windows 10 isn't saving it
Two complementary market analyst reports are showing that the PC market is still shrinking like crazy, and Microsoft's new Windows 10 operating system isn't doing much to change that.
According to IDC, the PC market is down another 8.7 percent in 2015, with a projected total of 281.6 million desktop and laptop computers shipped to retailers this year.
Check the chart:
In a press release announcing its findings, IDC writes:
Although IDC had expected the second quarter of 2015 to be a transition period as vendors prepare for Windows 10 systems in the second half of the year, final results nonetheless shrank even more than expected due to a stubbornly large inventory of notebooks from prior quarters and severe constraints posed by the decline of major currencies relative to the US Dollar.
Meanwhile, Pacific Crest Securities (the technology analyst group at KeyBanc) got down in the trenches and asked 29 retailers if Windows 10 was improving their PC sales, especially compared to the golden opportunity that was 2009's Windows 7.
The answer? Not really:
"Our checks found little evidence of elevated inventory levels or PC sales from Windows 10, which contrasts to the Windows 7 launch, but still seems better than Windows 8," Pacific Crest says.
It's a sentiment also expressed by HP's CEO Cathie Lesjak, who recently said the industry needed to "flush" the lackluster Windows 8 before Windows 10 could take off.
(Pacific Crest Securities)
Because of this, Pacific Crest is projecting a head-turning 14% year-over-year decline in Microsoft's Device & Consumer revenue for the next quarter, with an attendant overall 6% decline for the fiscal year.
The bright side, according to Pacific Crest? Analysts are setting expectations so low that Microsoft has ample opportunity to provide a positive surprise.
Meanwhile, IDC says that as touch-based and ultra-light PCs continue to mature, two-in-one devices like Microsoft's Surface Pro are growing even as sales of more traditional devices continue to shrink.
IDC also says that as Microsoft's free Windows 10 upgrade offer ends and enterprises look to refresh their PC fleets, 2017 could see at least a little of a market recovery.
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