Barclays Capital cuts global PC shipment forecast


CNA

TAIPEI — Barclays Capital has lowered its estimated year-on-year growth for this year’s global PC shipments, citing the weakest fourth-quarter demand for the past 10 years.

The growth for PC shipments, including desktop PCs and notebooks, was cut from 3.4 percent to only 2.2 percent, Barclays Capital said in a research note released Saturday.

Barclays Capital attributed the revision mostly to a cut in the bank’s fourth-quarter forecast, which has been lowered from a 4.3 percent growth year-on-year to a decline of 0.3 percent because of a hard drive supply shortage due to recent flooding in Thailand, which is where many hard drive manufacturers are located.

For the fourth quarter of 2011, the bank is expecting notebook shipments to decline 2 percent quarter-on-quarter, far worse than the normal seasonality of 14 percent growth.

Meanwhile, desktop PCs and motherboards are expected to decline 20 percent quarter-on-quarter, much worse than the normal seasonality of 5 percent decline, it added.

However, the bank believes there is a good chance of a recovery in PC shipments in the late second quarter of 2012 going into the third quarter of next year.

The bank based its optimism on channel inventory restocking after the hard drive shortage is resolved and other catalysts like Windows 8 and mid- and low-end Ultrabook laptops at an average selling price of US$600 (NT$18,162).

“It is not likely to be sustainable, as technology spending is highly correlated with GDP growth,” Kirk Yang, head of Asia ex-Japan tech hardware research based at Barclays Bank, Hong Kong, wrote in the note.

“We will need to first work through the high PC inventory, the highest in the last 10 years, before PC shipments rebound,” he said.

“We continue to like brand PC stocks from a relative perspective, as they tend to be more defensive in a down-stock market,” he added. “We expect both Acer Inc. and Lenovo Group Ltd. to gain share with margin improvements in 2012.”

However, on a longer-term perspective, Yang said it is difficult for Barclays Capital to stay too optimistic on Asian PC companies unless there is a strong economic turnaround, especially due to their smaller exposure to the fast growing cloud computing business such as software, IT services, storage and data centers.