Why Africa’s PC market experienced a historical decline of 37.2% in 2022

According to preliminary results made available by Gartner, Inc, a statistical organization known for tracking and releasing worldwide quarterly statistics on the personal computer (PC) market since the mid-1990s, Africa and the EME region witnessed a historical 37% drop in PC shipment in 2022.

It says this was due to factors such as political unrest, inflationary pressures, interest rate increases, and a pending recession. According to Mikako Kitagawa, Director Analyst at Gartner, a decline of this magnitude indicates a total halt of the market in the region.

He says:

“A decline of this magnitude only happens when market demand effectively comes to a halt,” said Kitagawa. “Business and consumer confidence across EMEA has collapsed, leading to a huge drop in demand. A massive increase in inventory has also severely limited sell-in opportunities as sellers focus on moving old stock.”

Mikako Kitagawa, Director Analyst at Gartner

In other words, the African PC market is taking a huge hit and facing a monumental drop in demand since the covid boom, which caused the supply in the market to go up during that period (2020-2021).

In a clear perspective, throughout the COVID phase, people were compelled to rely on a virtual method of doing things and learning; as a result, the demand for personal computers increased as people looked for substitutes for in-person gatherings and activities, which the PC was the primary tool and accessory.

But now, that same market is witnessing the steepest drop since Gartner started tracking the market. Also, for the year, PC shipments reached 286.2 million units in 2022, a 16.2% decrease from 2021.

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What this means for the PC Market in Africa

As may be the next market initiative to drive sales and supply upwards, Vendors might be looking at selling their products at discounted prices in the African region, for instance.

In fact, in some regions, vendors already offered discounted prices for their products during the festive periods to reduce their inventories and drive sales. With a predicted drop till 2024, vendors might consider lowering their prices.

If this is the case, then Africa and other regions may witness the lowest prices of personal computers in the coming year.

More on the preliminary data

According to the preliminary data, Worldwide shipments totalled 65.3 million units in the fourth quarter of 2022, a 28.5% decrease from the fourth quarter of 2021. This marks the largest quarterly shipment decline since Gartner began tracking the market in the mid-1990s.

“The anticipation of a global recession, increased inflation and higher interest rates have had a major impact on its demand. Since many consumers already have relatively new PCs that were purchased during the pandemic, a lack of affordability is superseding any motivation to buy, causing consumer demand to drop to its lowest level in years.”

 Mikako Kitagawa said in highlighting the probable cause

It further explained that higher inventory levels started building in the first half of 2022 and have become a bottleneck for the market at large. Low supply caused by high demand and supply chain disruptions through 2021 quickly turned into an excess of supply once demand quickly and significantly slowed.

“The enterprise PC market is also being impacted by a slowing economy,” added Kitagawa. “The demand among enterprises began declining in the third quarter of 2022, but the market has now shifted from softness to deterioration. Enterprise buyers are extending PC lifecycles and delaying purchases, meaning the business market will likely not return to growth until 2024″, Mikako added.

Also contained in the report are the top vendors of the year. The release revealed that the top three vendors in the worldwide market remained unchanged in the fourth quarter of 2022, with Lenovo maintaining the No. 1 spot in shipments. (See table above).

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Regional Statistics

In the U.S., the fourth quarter of 2022 saw a 20.5% fall in shipments, marking the sixth consecutive quarter of decline. The economic climate caused a slowdown in PC spending from consumers and businesses, following the pattern of the global PC market.

HP took over the top spot in the U.S. market based on shipments with a 26.8% market share. Dell followed with 23.4% of the market share in the U.S.

Other regions, such as the Asia Pacific market excluding Japan, declined 29.4% year-over-year, mainly due to the market in China.

While the fourth quarter has traditionally been peak season for China’s business PC market, budget cuts by the Chinese government and uncertainty around changing COVID policies led to a significant drop in overall demand.

“Even as vendors offered deep discounts during the holiday season in an attempt to lower inventory, consumers were not swayed to spare their money,” said Kitagawa.

“Total shipments in 2022 were close to pre-COVID levels, with 2019 shipments well below 300 million units,” said Kitagawa. “The PC industry experienced very unusual ups and downs over the past 11 years.  After the extraordinary growth period between 2020 and 2021 due to the pandemic, the market has clearly begun a downward trend which will continue until the beginning of 2024.”