Device Shipments to Decline for Second Consecutive Year

• By Joshua Bolkan
• 10/12/16

Global device shipments, including PCs, tablets, ultramobiles and mobile phones, will decline by 3 percent this year, marking the second consecutive year of negative growth, according to a new report from market research firm Gartner. In 2015, the device market declined by .75 percent.

The market will not return to even modest growth any time soon, according to the company, which projects device shipments to remain flat for the next five years.

Traditional PCs, including desktops and notebooks, will drop to 216 million shipments this year, from 244 million in 2015. That decline will slow, but continue in the coming years, falling to 205 million in 2017 and 199 million in 2018, according to Gartner's forecast.

Business spending will have to "flourish" for PC shipments to maintain flat growth in 2017, according to information released by the company.

"The inventory of Windows 8 PCs should have been cleared, and large businesses in mature markets are now looking to move to Windows 10 through 2018," said Ranjit Atwal, research director at Garnter, in a prepared statement. "In addition, more affordable hardware and increasingly available virtual reality content (such as games, stories and other entertainment) will enable consumer PC buyers to upgrade in order to experience immersive offerings."

The premium ultramobile category, which includes devices such as the MacBook Air and Windows 10 Intel x86 devices, is the only category projected to increase shipments this year and one of only two forecasted to increase shipments through 2018. The category saw 44 million shipments last year and is on pace to see 49 million shipments this year. Gartner predicts the category will pick up steam, moving 61 million devices next year and 75 million devices in 2018.

Basic ultramobiles, which includes iPads, Samsung Galaxy Tab S2s and other tablets, will fall from 196 million shipments in 2015 to 177 million units sold this year and 173 million units each of the next two years.

"Total mobile phone shipments are on pace to decline 1.6 percent in 2016," according to a news release. "The smartphone segment continues to grow, albeit more slowly than in previous years, and is expected to reach 1.5 billion units in 2016."

"This is no surprise; the smartphone market is maturing, and reaching global saturation with phones that are increasingly capable and remain good enough for longer," said Roberta Cozza, research director at Gartner, in a prepared statement.

Mobile phones are the second category that is projected to see sales increase from 2015 to 2018. Though shipments will fall from 1.917 billion units in 2015 to 1.887 billion units this year, sales will increase to 1.933 billion units in 2018.

"We expect the market for premium smartphones to return to 3.5 per cent growth in 2017, as stronger replacement cycles kick in and in anticipation of a new iPhone next year, which is expected to offer a new design and new features that are attractive enough to convince more replacement buyers," added Cozza.