Deutsche Bank is cutting its PC growth estimates citing the upcoming 64-bit iPad and its penetration into the corporate market as the reason for the declining estimates.
In an investors note on Monday Chris Whitmore of Deutsche Bank Equity Research wrote that PC shipment estimates for 2013 and 2014 have been cut to -10% and -8% year-to-year respectively. That’s down from previous estimates of -8% and -6%.
We…expect growing [desktop] virtualization and iPad deployments in the enterprise to pressure corporate PC sales through 2014-15…We expect AAPL’s [Apple's] iPad refresh to include 64 bit architecture, which should enable a greater array of enterprise App development and facilitate greater enterprise penetration over time.
In the near term, back to school PC demand appears relatively soft and recent new hardware releases (Haswell) had little impact spurring incremental demand. Furthermore, we believe the corporate upgrade cycle will peak in [second half of calendar year 2013] as corporates complete Win 7 transitions ahead of Microsoft’s ending support of XP in early 2014.
The expectation is that the 5th generation iPad and the 2nd generation iPad mini will both receive the 64-bit A7 processor that was included in the recently released iPhone 5s. This will enable new possibilities for apps in enterprise and educational markets help to continue the erosion of PC market share.
I fully expect to see new iPads this month and certainly hope the A7 chip makes its way into the 9.7 inch iPad at least. The trend for tablets, and iPads specifically, as work and school tools is likely to continue as processors become more advanced and the devices gain even more capabilities. They may not be as functional as traditional PCs yet but continue to provide much of what is needed while being easy and enjoyable to use.
The PC market has been declining for some time as people assess their needs, which can often be met (and met well) by an iPad, and this looks set to continue over the next few years as iPads, Android tablets and Chromebooks continue to sell.