Report: Smartphone and PC Shipments to Fall in 2023

Device shipments will decline this year as cash-strapped consumers postpone smartphone and computer purchases.

That’s according to a forecast released Tuesday (Jan. 31) by research firm Gartner, which projects sales of phones and PCs will fall for the second straight year. It’s a decline that’s happening as consumers reprioritize their spending as their buying power is reduced.

“The depressed economic market will continue to dampen demand for devices throughout 2023,” Ranjit Atwal, senior director analyst at Gartner, said in a news release. “In fact, end-user spending on devices is projected to decline 5.1% in 2023.”

The report projects that global shipments of devices — defined here as PCs, mobile phones and tablets) will fall 4.4% this year to 1.7 billion units. This follows a decline of 11.9% last year.

PC shipments will see the worst decline of the three device categories, the forecast said, down 6.8% in 2023 after a 16% drop in 2022. Gartner attributes this decline in part to businesses choosing not to upgrade their operating systems last year.

Smartphone sales are projected to drop 4%, the report said, from 1.28 billion units in 2022 to 1.23 billion this year.

“Consumers are holding onto their phones longer than expected, from six to 9 months, and moving away from fixed to flexible contracts in the absence of meaningful new technology,” said Atwal. “In addition, vendors are passing on inflationary component costs to users which is dampening demand further.”

Gartner’s forecast follows a report last week from researchers at IDC, which found a record drop in worldwide smartphone sales last year.

And both these reports come as consumers are rethinking their retail spending, as noted in “New Reality Check: The Paycheck-to-Paycheck Report: The Economic Outlook and Sentiment Edition,” a PYMNTS and LendingClub collaboration.

Necessities like rent and mortgage, food, fuel and utilities are overtaking household earnings, the report found, with 9.3 million more U.S. consumers living paycheck to paycheck at the end of 2022 than in 2021. For added context, 8 million of them earn more than $100,000 per year.

As to how this will affect retail spending, there’s an expectation among consumers that big-ticket discretionary items they considered purchasing in 2022 will be off the table this year.

“With inflationary pressures dampening their optimism, many consumers are likely to shy away from large purchases in 2023, primarily electronics, appliances, and leisure travel,” the study said. “Only 35% of consumers said they will incur leisure travel expenses in 2023, and just 24% plan to purchase expensive electronics or appliances in 2023.”