The global laptop and PC market is gradually recovering, coupled with the rising trend of AIPC. Laptop brands, including Acer and ASUS, as well as major contract manufacturers like Foxconn and Quanta, have all released positive outlooks for 2024.

Semiconductor giants such as Intel, NVIDIA, AMD, Qualcomm, and others actively entered the AI PC chip market in the second half of 2023, positioning themselves strategically. Both laptop brands and terminal manufacturers have expressed expectations for this development.

Acer

Jason Chen, Chairman and CEO of Taiwan-based computer manufacturer Acer, stated on November 30th that they are currently tallying the sales performance of Acer during Black Friday and Cyber Monday, and the current results are satisfactory. Looking ahead to the PC industry next year, from an overall economic perspective, there are still many uncertain factors, but it appears to be better than this year.

Chen further pointed out that the impact of the pandemic has passed, inventory digestion has also concluded, and entering the traditional seasonal performance, the specific application of generative AI will bring a new wave of demand stimulation.

Regarding AI PCs, Chen emphasized that the transition to AI PCs will be a gradual process rather than a sudden occurrence. He anticipates this transformation will take place in both commercial and consumer markets in the future.

ASUS 

According to UDN’s report, ASUS, another major Taiwanese laptop manufacturer, emphasized the significance of AI PCs during its November investor conference. Co-CEO, S.Y. Hsu, highlighted that AI PCs represent a crucial turning point for the industry, promising a significant improvement in user experience and ushering in a new era for the PC industry.

While he acknowledged that consumer acceptance of AI PCs would take time to increase, he predicted that the penetration rate of AI PCs would reach single digits in 2024 and double digits in 2025, depending on the user experience and technological maturity of AI PCs next year.

Foxconn

For Taiwanese electronics contract manufacturer Foxconn, the outlook for the PC industry in the coming year is described as “very good” by Chiang Chih-Hsiung, General Manager of the B Group and Digital Health at Foxconn.

This indicates Foxconn’s positive expectations for performance in the PC-related industry. Foxconn had previously emphasized that, in addition to AI servers, it would collaborate with customers to expand its presence in the AI PC sector in 2024.

Quanta

In a public interview on November 30th, Chairman Barry Lam of Taiwanese electronics manufacturer Quanta discussed the overall outlook for the next year, emphasizing the role of generative AI in shaping future technological developments.

With the rapid growth in AI computing power demand, the market conditions for next year are quite optimistic. Lin is particularly bullish on the future prospects of three major products: AI PC, AI servers, and AI automotive electronics, with a special emphasis on the significant growth potential of AI PCs.

Quanta is optimistic about the growth momentum in this sector, especially with Microsoft set to launch the latest Windows featuring AI functions next summer. Quanta envisions continued collaboration with GPT in the future for PCs.

TrendForce’s Insight

TrendForce reports the global shipment of notebooks is expected to reach 167 million units in 2023—a YoY decrease of 10.2%. However, with inventory pressures easing, the notebook market is anticipated to return to a balanced supply and demand cycle in 2024. Overall shipment volume is forecast to reach 172 million units, marking a YoY increase of 3.2%.

As for AI PC, TrendForce believes that due to the high costs of upgrading both software and hardware, early development will be focused on high-end business users and content creators. This targeted group has a strong demand for leveraging AI processing capabilities to improve productivity efficiency and can also benefit immediately from related applications, making them the first-generation primary users.

The emergence of AI PCs is not expected to necessarily stimulate additional PC purchase demand. Instead, most upgrades to AI PC devices will occur naturally as part of the business equipment replacement cycle projected for 2024.

Nevertheless, looking to the long term, the potential development of more diverse AI tools—along with a price reduction—may still lead to a higher adoption rate of consumer AI PCs.

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• Key Development Period for AI PCs in 2024; Global Notebook Market Set to Rebound to Healthy Supply-Demand Cycle with an Estimated Growth Rate of 3.2%, Says TrendForce

(Photo credit: Pixabay)

According to TrendForce’s latest research, global NB shipments are forecasted to drop by 5.8% YoY to around 177 million units. However, the downtrend in NB shipments is starting to moderate, and the projected figure for 2023 is expected to represent the lowest point before 2025. Currently, inventory corrections for components and whole devices are taking place in the global supply chain for NBs. Prices are also being cut substantially across sales channels, and PC OEMs have scaled back component procurements. There is a chance that the NB market will return to its usual cyclical pattern and show growth during 2H23, when back-to-school and holiday-related promotions are expected to boost device sales.

However, this scenario will depend on two factors. First, PC OEMs will have been able to effectively get rid of the existing stock of NBs belonging to the older generations during 1H23. Second, global inflation will ease as 2023 progresses. Currently, the IMF forecasts that the rate of global inflation will slide down to 6.5% in 2023, compared with 8.8% in 2023. Such development will help raise the consumer spending related to electronics. All in all, notable inventory corrections and the reduction of inflationary pressure will allow the NB market to leave the gloomy situation of 2022 and get back to upbeat state of quarter-to-quarter shipment growth.

Market Segments for Commercial and Consumer NBs Will Both See Decline in 2023, Chromebooks, Gaming NBs, and Creator NBs Will Become Main Demand Drivers

Looking at the various segments of the NB market, unit shipments and market share are expected to drop for both commercial NBs and consumer NBs. Conversely, Chromebooks will grow in terms of shipments and market share despite various headwinds. In 1H23, mature regional markets such as the US and emerging regional markets such as Indonesia and India will be releasing tenders for Chromebook for educational uses. Turning to gaming NBs, their global shipments are forecasted to increase by 8.3% YoY to 17.45 million units for 2023 thanks to the seasonal demand surge in 2H23. As for creator NBs, the market for them is growing because professional content creators want to purchase a “mobile workstation” in place of a high-end gaming NB for tasks such as building 3D models and processing large amounts of multimedia files. Global shipments of creator NBs are forecasted to rise by 24.9% YoY to around 437,000 units for 2023.

(Note: “NB” stands for notebook or laptop computer.)

Since corrections continue to occur in the current global notebook computer market as a result of the “overbooking” bubble, destocking of terminal products is expected to continue until the first half of 2023, when cyclical growth momentum is likely to return to the market.

TrendForce forecasts that global notebook computer market shipments will reach 191 million units in 2022, falling 22.3% YoY. The first quarter of 2022 benefitted from a backstop created by market demand for business model notebooks, laying the foundation for a 2022 “not-off off-season.” However, the global notebook computer market encountered zero-COVID control measures in Shanghai, China, resulting in a supply chain suspension in 2Q22. In addition, rising inflation stalled global consumer electronics market demand. Shipment volume is only expected to be approximately 44.35 million units up until 4Q22, demonstrating that 2022 has reversed the established market norm, replacing “QoQ growth” with “QoQ decline.”

Global notebook computer market shipments will reach 177 million units in 2023, cyclical growth momentum is expected to play an important role

Looking back on 2022, due to the reversal of demand in the global notebook computer market beginning in 2Q22, the overbooking bubble caused by the COVID-19 pandemic has corrected quarter by quarter, resulting in a sharp increase in inventory levels at PC brands. Therefore, accelerating the destocking of notebook computer products is the current focus of PC brands with individual sales channels all adopting promotional strategies based on substantial price cuts. If the inventory level of terminal products can be reduced, it will be beneficial for PC brands to continue purchasing semiconductors and other materials in 2023 and pessimistic market conditions will not spread to the foundry industry, which is conducive to a positive cycle.

Movements in the current global laptop market to correct for the overbooking bubble will continue until the first half of 2023. The second half of 2023 coincides with cyclical growth momentum from back-to-school shopping and holiday seasons in major consumer electronics markets such as the United States, Europe, China, and Japan, and the global notebook computer supply chain is expected to ramp up supply from 2Q23 to reproduce a demand scenario wherein the second half of previous years surpassed the first half. Global notebook computer market shipments is estimated to reach 177 million units in 2023, an annual decline of approximately 7.7% and the proportion of shipments in terms of the first half compared to the second half of the year will be approximately 47:53.

（ Image credit: pikwizard）

Due to the pandemic, laptops shipments reached a record high of 240 million units in 2021, according to TrendForce‘s investigations. However, the market has been abuzz recently and, as the global population of the fully vaccinated has exceeded 50%, relevant demand driven by the pandemic is expected to gradually weaken. Shipment volume will decrease by 3.3% year-on-year, revised down slightly to 238 million units. Chromebooks will account for approximately 12.3% of shipment volume, though it accounted for approximately 15.2% in 2021. The momentum of shipments has slowed down significantly which indicates that demand derived from the economic effect of remote working and teaching has subsided.

TrendForce further states that Chromebook shipments declined sharply by nearly 50% in 2H21 due to the end of the Japanese government’s education tender and an increase in U.S. market share. However, thanks to the sequential return to the office of European and American companies driving a wave of commercial equipment replacement, shipments of commercial laptops have grown rapidly to make up for the shortfall. In turn, the shipment of laptops in 4Q21 hit the highest levels of the year, reaching 64.6 million units. In addition, due to the severe shortage of IC materials in mature processes, the backlog of orders extends to 1Q22 and the off-season is expected to be short. Compared with the average quarterly reduction of 15% in previous years, this year’s pullback is expected to be less than 10%.

It is worth noting that due to the shortage of container ships and issues with port congestion, shipping time has been prolonged, increasing by two to three times from manufacturers in mainland China to the United States compared to before the epidemic. Notebook brands have all been shipping in advance and the proportion of air freight shipments has increased. However, shipping time still exceeds expectations, which may flood the supply chain with duplicate orders from downstream customers, resulting in overstocked inventories and the risk of subsequent orders being canceled. In addition, the wave of commercial equipment replacement driven by a return to the office will be a major variable that will affect the demand for notebooks in 2022, resulting in near-term buzz in the market.

TrendForce indicated that in the past, due to factors such as fewer working days during the Lunar New Year Holiday and labor shortages in mainland China, brands would often require large OEMs to produce and ship before the Lunar New Year. This first quarter end-of-season surge will start from this month. Even though changes in end-user demand is unclear, March will see the beginning of a production surge to end the first quarter. If there is a major change in demand at that time, it may lead to an accumulation of distribution channel inventory, leading to a downward revision in demand, and a return to the normal equipment replacement cycle.

Shipment of curved monitors for 1H21 was constrained by the shortage of such components as panels and scaler ICs, according to TrendForce’s latest investigations. As countries begin to lift pandemic-related restrictions following increased vaccinations in Europe and the US in 2H21, consumer demand generated by the stay-at-home economy has undergone a noticeable slowdown as well. Taking these factors into account, TrendForce, therefore, expects annual curved monitor shipment for 2021 to reach about 15.6 million units, a 10% YoY increase.

TrendForce finds that curved monitor shipment for 2Q21 reached about 3.41 million units, a 6.1% QoQ decrease. Samsung once again took a leadership position with a quarterly shipment of 1.09 million units and a 32% market share. Coming in second place was AOC/Philips, which posted a 12% market share with a shipment of 410,000 units. Finally, MSI and Dell each took third place and fourth place with 10% and 8% in market share, respectively.

It should be pointed out that, SDC, the largest supplier of curved monitor panels last year, reduced their production of LCD monitor panels considerably in 1H21. As a result, brands which had heavily relied on SDC’s panel supply, including Samsung Electronics, AOC/Philips, HP, and HKC, experienced QoQ declines of 21%, 36%, 64%, and 32%, respectively, in their shipments of curved monitors for 2Q21.

Conversely, LGE, Acer, and Dell saw QoQ increases of 110%, 47%, and 38%, respectively, in their curved monitor shipment for 2Q21 against the market downtrend. These companies’ growths can be attributed to the fact that they did not adopt SDC panels for most of the models in their curved monitor lineups while SDC was the predominant supplier of curved monitor panels. LGE, in particular, did not procure panels from SDC at all. Instead, these aforementioned companies have mostly been sourcing panels from AUO or CSOT for their newly released curved monitors, meaning they will be relatively unaffected by SDC’s shuttering going forward.

For more information on reports and market data from TrendForce’s Department of Display Research, please click here, or email Ms. Vivie Liu from the Sales Department at vivieliu@trendforce.com

（Cover image source: Unsplash）