After a two-year lull, businesses are warming up to laptops and PCs

Commercial sales of laptops, desktops and tablets—excluding government contracts—rose nearly 4% year-on-year in the June quarter, according to data released by market researcher International Data Corporation Monday. That’s the biggest jump in demand from enterprises since June 2022, surpassing a 1% growth in the three months ended March.

The rebound from a two-year lull also reflects growing demand from global capability centres and an expected revival for India's $250-billion IT industry, according to analysts and retailers. Even Apple saw a 65% surge in the money it makes from selling Macs between April and June on enterprise deals, Mint reported on 3 August. Overall PC sales in India rose 7% year-on-year to 3.39 million units during the period.

“Enterprises are upgrading their PCs to comply with a compulsory software upgrade cycle for Windows PCs, as well as increasing demand based on revival in tech projects and digital transformation," said Ashweej Aithal, analyst at market researcher Canalys. For small and big enterprises, he said, an anticipated need for PCs that support AI applications in the next four quarters has also started boosting demand.

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Companies dominate the demand for original equipment makers. For Acer India, corporate clients contribute bulk of the revenue even as it is looking to ramp up its presence in the consumer market.

“As of today, we have over 7.5 million IT assets under direct maintenance and warranty of Acer India," said Harish Kohli, president and managing director for India at the Taiwanese company. “Our enterprise sales account for 55% of the annual revenue at present, and we have a robust trust factor where we account for first-tier choices within the banking and financial services domain—one of India’s biggest demand generators for technology."

PC sales

Acer’s India sales rose nearly 35% in the first half of this year—showcasing strong demand from enterprises for India’s fourth-largest laptop brand.

HP, India’s largest PC company, sees this refresh cycle powered by disruptive technology changes an opportunity to expand its sales among businesses.

“We’re thinking about generating work, but if we talk about numbers—in terms of the economy, SMBs (small and medium-sized businesses) and other industries growing, many of them are rethinking the way we do everything," said Ipsita Dasgupta, senior vice-president and managing director of HP India. “The PC could be pivotal to all of this."

Two enterprise channel retailers confirmed the resurgence in shipments in anticipation of greater AI features and support ending for Windows 10. "Apple is benefiting the most here, giving distributors of Windows-powered PCs a tough challenge in the past two quarters," said one of the retailers.

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According to Canalys’ Aithal, enterprises are still to see hardcore AI use cases and Microsoft’s ‘Copilot-Plus’ AI systems are yet to impact the market in India. “But there is a clear sentiment for enterprises to be more resilient in upgrading their IT hardware, which promises to be a good sign for PC brands."

But he does not expect Apple to be a big beneficiary even though it is growing at the fastest pace on a low base. “The price difference between PCs from Apple and Windows brands has been minimized, but Apple will struggle to crack the enterprise category—where high-value Windows products will continue to drive the market," he said. “Even though we expect a high-single digit uptick in enterprise PC demand going forward, this will help PC brands in India in the long run."

Higher shipments to enterprises also reflect demand from a growing number of global captive centres being established in India as well as a potential IT recovery. While the sector, barring the leader Tata Consultancy Services, reported a dismal June, chief executive officers of the India’s top four IT firms anticipate tech deals to recover.

“There will only be so much time for which brands will hold off digital transformation and tech upgrade," Omkar Tanksale, senior equity analyst at Axis Securities, told Mint last month. “After a point, there will be a cyclical upgrade cycle that will set in, and the macroeconomic headwinds seem to have bottomed out—suggesting that the IT services industry is in for a revival in the rest of the fiscal."

No wonder PC brands anticipate higher sales by volume and value this year.

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