After Citigroup analyst Glen Yeung said at the beginning of September that the bank anticipated the worst fiscal second half for PC sales ever, fear grew that PC demand had reached a bottom.
Sparking the ferment was Intel’s (NASDAQ:INTC) decision to lower the company’s projected third-quarter revenue and gross margin in early September.
On September 7, Yeung told CNBC, “We were looking into the supply chain over the course of August, and really everywhere you looked, PC data points are bad. What we’re ultimately going to end up with is the worst third quarter in the history of PCs this quarter, so obviously the outlook is pretty dire.”
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Concerns have continued to hold weight with analysts as vendors increase inventory ahead of Microsoft’s (NASDAQ:MSFT) Windows 8 launch on October 26. According to a report in the electronics publication Digitimes, Taiwan-based notebook manufacturers, or ODMs, have indicated that shipments to vendors in September increased by 30 to 50 percent. In particular, notebook shipments to Hewlett-Packard (NYSE:HPQ) increased by 70 percent in one month.
However, while notebook vendors and ODMs remain positive about growth in global demand due to notebook replacement, Digitimes reports, the Taiwanese component makers are generally conservative in their predictions for the rest of the year. This stance indicates that growth in the fourth quarter, or even in the first quarter of 2013, will be slow.
According to the publication, “Sources from component makers pointed out that first-tier PC brand vendors have all reduced their shipment forecasts for 2012 with the exception of Apple as the company’s MacBook series shipments are still expected to enjoy a 20-30% on-year growth to 15-16 million units.”