Analyst predicts five percent growth
Global PC sales have tanked for two years, but a new report suggests that the downturn has hit rock bottom, and desktop and notebook sales are ready to rebound. Financial analyst Gus Richard with Piper Jaffray is forecasting a boost in PC sales in 2014 by a modest 5 percent.
As part of a report on Intel’s outlook, Richard said desktop and notebook PC sales in 2014 will grow thanks to the sun-setting of Windows XP and the release of Windows 8.1. He also expects Intel’s upcoming Bay Trail microprocessor, used in hybrid notebooks and tablets, to drive sales.
Overall computer shipments had plunged roughly 11 percent in the second quarter of 2013, after dropping 14 percent the quarter before that, according to IDC. Piper Jaffray estimated that 30 percent (or 500 million PCs) of the 1.2 billion PCs in use today still run on Windows XP. With Windows XP support ending in April 2014 about a third to half of PCs will be refreshed, Richard said. That puts the number of XP upgrades between 150 million to 250 million PCs, Piper Jaffray estimates.
“This is more of a dead-cat bounce than a fundamental PC market change,” Richard said. He said sales in desktops and notebooks will continue to be cannibalized by a booming market for tablets and smartphones, and that PC sales will grow in 2014 and likely be flat for the next three to five years as older XP systems are put out to pasture.
Piper Jaffray raised its price target on Intel’s stock to $22 from $20 while upgrading its recommendation to “neutral” from “underweight.” Piper Jaffray forecasts Intel’s revenue in 2014 should rise to $54.2 billion from a projected $52.9 billion in 2013.
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