FRAMINGHAM, Mass. — (BUSINESS WIRE) — August 29, 2016 — Worldwide PC shipments are forecast to decline by 7.2% year over year in 2016, followed by a decline of 2.1% in 2017, according to an updated forecast from the International Data Corporation ( IDC) Worldwide Quarterly PC Tracker. This remains quite close to May's projections for declines of 7.3% in 2016 and 1.6% in 2017. Growth for the second quarter of 2016 came in at -4.1%, more than 3 percentage points ahead of expectations. The gains, primarily in the United States, Western Europe, and Latin America, were partially attributed to rebuilding inventory, which is not expected to continue in the second half of 2016. Momentum from the stronger than expected second quarter was also undermined somewhat by continuing economic and political volatility, including exchange rates, commodity prices, Brexit, and related or similar factors across regions.

Despite the challenges, PC shipments are gradually stabilizing, with some positive (albeit minimal) growth expected in 2018. Competition from other devices and longer device life have been the root causes of slower growth, but both are having less impact, opening the way to PC replacements, particularly in the commercial market. Although detachable tablet shipments continue to grow quickly, growth is slowing from a peak last year and volume has been less than 14% of notebook volume so far this year. Commercial notebook growth is expected to peak at almost 5% during the forecast while commercial desktop shipments will return to flat growth. In contrast, consumer shipments of both notebook and desktops are expected to decline throughout the forecast. Combining detachable tablets with PCs, the market is projected to decline by 2.8% in 2016 with small positive growth in later years.

"The PC market continues on a slow path to stabilization – quite close to prior forecasts," said Loren Loverde, vice president, Worldwide Tracker Forecasting and PC research. "The political and economic disruptions, as well as the small shift in growth from tablets to notebooks that we saw in the second quarter, are small shifts in device replacement and competition between categories. We still expect shipments to stabilize over the medium term, while market leaders will benefit from further consolidation."

The U.S. PC market showed marked improvement in the second quarter – up 3.9% compared to down 7.6% in the first quarter. However, some of this rebound is attributable to inventory buildup in preparation of the education buying season as a cautious attitude in the channel began to subside following months of reducing inventory. "Although we believe much of the second quarter result was related to a one-off inventory intake, there is still cause for optimism in the second half of this year," said Linn Huang, research director, Devices & Displays. "We are still ascending towards the peak education and back-to-school buying season, have a Chrome OS that is more ready for consumer primetime than it has ever been, and are anticipating some early Windows 10 transitions in enterprise."