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HP Shares Fall As Acer Delivers Record Growth

HP shares have fallen sharply after IDC forecast a slowdown in notebook demand after record growth during COVID-19 lockdowns.

Also impacting the value of Hewlett Packard shares is new data that HP only grew 2.7% last quarter while Acer grew 17.6%, Lenovo 14.9% and Dell 16.4%.

Leading PC research firm IDC data showed global PC shipments grew 55% in the first quarter of 2021 from the same period the prior year, but this was not enough to stop HP shares falling close to 5% as the US PC Company battles supply issues.

Analysts claim that last year’s growth is going to be difficult to maintain.

“While demand potential in the commercial segment appears strong, early indicators may suggest consumer demand has begun to slow somewhat as spending priorities shift post-a year of aggressive PC buying,” said Evercore analyst Amit Daryanani.

“With supply constraints limiting production, rising inventory levels could also signal slowing PC demand in the consumer and education markets, which have been strong for the past year,” said Morgan Stanley analyst Katy Huberty.

IDC data reveals that the surge in PC demand continued through the second quarter of 2021 (2Q21) despite global component shortages and logistics issues.

Worldwide shipments of Traditional PCs, inclusive of desktops, notebooks, and workstations, reached 83.6 million units in 2Q21, up 13.2% from the second quarter of 2020 according to IDC.

“The PC market’s hot streak continued to drive heavy investments from the supply side including the entry of new vendors as well as additional spend from underdogs,” said Jitesh Ubrani research manager for IDC’s Mobile and Consumer Device Trackers. “And while the top 5 continue to drive volume, the smaller vendors have helped drive growth by offering unique features or niche designs.”

Though annual growth remains quite high, it has begun to taper off as the 13% growth rate in 2Q21 is far lower than the 55.9% growth in 1Q21 and 25.8% growth in 4Q20. “The market faces mixed signals as far as demand is concerned,” said Neha Mahajan, senior research analyst with IDC’s Devices and Displays Group. “With businesses opening back up, demand potential in the commercial segment appears promising. However, there are also early indicators of consumer demand slowing down as people shift spending priorities after nearly a year of aggressive PC buying.”

The top PC Companies were as below.

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