Sales of mobile computing products through European distributors are expected to continue on a downward trajectory in Q2 2023, although the second half of the year should see much improved performance, according to CONTEXT, the global IT market intelligence company.
The latest figures for mobile computing (notebooks, notebook workstations and tablets) are taken from CONTEXT’s Channel Forecast Q2 2023 report.
Even the optimistic forecast predicts a −23.3% year-on-year (YoY) slump in unit sales for Q2, while the pessimistic scenario has sales falling by −32.5% over the period. And this comes after a −21.6% drop in units sold in the first quarter.
“The two possible scenarios largely reflect our low expectations for the economy as a whole this quarter but the more positive outlook assumes greater sell-out of excess stock”, said Adam Simon, Global MD at CONTEXT. “It also takes into account stimulation programmes designed to remedy the supply problems we saw in mid-2022 and assumes these will be successful. High inflation will continue to impact business spending in Q2, especially that of SMBs which have to manage their cash flow more carefully. Most organisations will delay purchases and where there is spending, it is unlikely to be on devices. Increases in the cost of living will continue to affect consumers, and there is a certain amount of saturation in this market due to purchases made during the pandemic.”
Better times ahead
However, the outlook for the rest of the year is more positive: both the optimistic and pessimistic scenarios see performance improving. Even so, Q3 growth will still be negative due to difficult YoY comparisons. Nonetheless, the optimistic forecast for Q4 is that mobile computing unit sales will grow by 5.8% and by even more in Q1 2024. By then, even the negative scenario predicts sales growth of 3.6%.
We’ve predicted that, over 2023 as a whole, mobile computing unit sales will be somewhere between −12% and −18.9% down on 2022, with revenues reduced by −7.6% to −14.8% YoY. The smaller falls expected for revenues are a consequence of ever-rising average selling prices for mobile computing devices, even though these increases will be smaller than those of 2 or 3 years ago.
"Activities designed to drive out low-end stock will be more than offset by higher demand and prices for mid-range and high-end products – something that has been happening since the start of the pandemic", added Adam Simon. "So, although the current picture is rather gloomy, there are reasons to be optimistic."