AI, post-Covid work from home culture will reverse slump in world PC sales, Acer CEO says
- Acer chairman and CEO Jason Chen says a surge in PC sales during the pandemic means more than before will need to be replaced during the next refresh cycle
- Demand for chatbots, such as ChatGPT, will drive purchases of late-model PCs over the next few years, says the boss of the Taiwanese hardware and electronics firm
A post-coronavirus work from home culture and rising unit prices will stop the long slump in PC sales caused by weak consumer confidence, the head of the world’s sixth-largest vendor said this week during the Computex Taipei tech show.
Sales of laptops and desktops have declined over the past 12 months because inflation and interest rates combined to hurt consumer sentiment, Jason Chen, the chairman and CEO of Taiwanese hardware and electronics firm Acer, told the Post said on Wednesday.
But the surge in PC purchases during the pandemic for remote working and home study means more machines than before will need to be replaced during the next so-called refresh cycle, Chen said.
A refresh cycle usually refers to business replacement of hardware and software every three to five years.
From the macro level, inflation has triggered interest rates, and the interest rates have triggered [weaker] consumer confidence
“From the macro level, inflation has triggered interest rates, and the interest rates have triggered [weaker] consumer confidence, and because of that, the end-user demand made a drastic change about four quarters ago,” said 61-year-old Chen, who was appointed CEO in 2014.
Interest rates have risen as central banks tightened monetary policy to combat inflation, which grew in much of the world last year due to rising energy prices and shipping costs.
Working from home, however, shows no sign of disappearing despite the end of Covid-19 controls, Chen added.
He said remote working and studying at home during the pandemic meant that every family member had a PC rather than sharing one.
Wow, what a view! China’s ‘digital nomads’ seek paradise while on the clock
Around a third of workers with jobs that can be conducted remotely are working from home, the Pew Research Centre said in a survey released in March.
“When we talk about refresh cycles, the numbers required will be higher because of the bigger installation base,” he said.
In fields such as accounting and human resources “people get used to that working model and it’s harder to get them back,” he added.
Consumers are already buying up PC accessories, such as docking stations and different kinds of connectors, he said.
PC shipments across vendors reached 286.2 million units last year, down by 16.2 per cent from 2021, according to market research firm Gartner.
Shipments of just 55.2 million units in the first three months of 2023, representing a 30 per cent decrease from the first quarter of 2022, follow what Gartner describes as an “unfavourable combination of oversupply and continued low PC demand due to economic uncertainties”.
Acer sold 3.523 million units in the first quarter, according to Gartner.
Rising average sales prices of PCs stand to increase overall sales revenues, Chen said.
Generative AI will become more popular and people will use it for productive purposes
Consumers are often willing to pay more for PCs with strong computing power and parts made from recycled materials, he added, with the PC gaming market already “declining less”, he added.
Over the next few years, the demand for generative chatbots such as ChatGPT will drive purchases of late-model PCs, Chen said, as phones are not suitable due to their lack of keypads and small screens.
“Generative AI will become more popular and people will use it for productive purposes,” said Chen, who previously worked for 14 years at Intel and eight years at Taiwan Semiconductor Manufacturing Company.
Chen said India and Indonesia are also taking increasing numbers of PCs because of their relatively large young population employed by burgeoning manufacturing sectors.
The next Bali? Taiwan city tries to lure remote workers amid talent shortage
Market research firm IDC ranks Acer, which plans to expand sales and marketing in both countries, as the fourth-largest vendor in India.
In another boost to global PC sales, Chen said Chromebooks orders are also picking up.
Acer, among other brands, make the lightweight notebooks together with Google.
School districts in the US and Europe are placing orders, Chen said, and Acer is discussing sales with India and Japan.
