Dell, HP post underwhelming returns as PC market remains in a state of flux
Original equipment manufacturers (OEMs) are contending with an impending Windows 10 EOL and a burgeoning AI PC market


Enterprise PC purchasers face a confusing state of affairs as revenue and share prices dip at some of the leading device manufacturers.
Dell posted fourth quarter revenue expectations below Wall Street expectations according to reporting by Reuters, with executives noting that enterprise customers are being mindful of their PC and IT spending in the short term at a post-earnings conference call.
The firm said it expects revenue to be between $24 billion and $25 billion, while analyst estimates forecast revenue to be $25.57 billion, according to the London Stock Exchange Group (LSEG).
HP is having a similar issue, posting first-quarter profit that was also below Wall Street expectations in a revelation that sent the firm’s share price down by 8%.
Both leading PC manufacturers are facing a number of challenges according to Andrew Hewitt, principal analyst at Forrester, with traditional PC demand and AI PC demand in a state of flux.
“The low earnings and revenue certainly demonstrate that manufacturers are in a bit of a lull at the moment,” Hewitt told ITPro.
“OEMs are dealing with multiple compounding factors: a pandemic-era fleet of devices that's set for refresh but not quite there yet, an impending Windows 10 end of service in 2025, and the prospect of a sizeable ramp up in AI PC adoption in 2025,” he added.
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This has put enterprise buyers in a “state of confusion,” Hewitt said - many aren’t sure if they are ready to invest in AI PCs while others don’t have the hardware to support the transition to Windows 11. This is manifesting the returns seen from OEMs, he added.
Better times ahead?
Despite worrying returns from these big name manufacturers, Hewitt expects the market to bounce back, and some research seems to support the claim.
“I do expect this trend to be short-lived. The PC has and will remain (for quite a while at least) the dominant productivity tool in the enterprise,” Hewitt said.
“I'd expect the market to start moving faster in the second half of 2025 due to increasing AI PC demand combined with an opportune time to upgrade devices: the Windows 10 end of service in October 2025,” he added.
In April 2024, research firm Canalys reported that global shipments of desktops and notebooks grew 3.2% to 57.2 million units in the first quarter of 2024. Notebook shipments specifically were up 4.2% to 45.1 million units, while desktop shipments were down by 0.4% at 12.1 million units.
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Gartner predicted a rebound in the PC market back in late 2023, suggesting that the slump had “bottomed out” and that a return to growth could be expected in 2024.
While Dell and HP’s earnings don’t necessarily align with Gartner's prediction, the analyst consensus appears to be that the PC market is set for a period of growth at least some time in the near future.
There are some reservations in the channel as well though, with research from Canalys suggesting that many aren’t enthusiastic about AI PCs despite being a fan of AI more generally.
More than a third don't plan on selling Copilot+ PCs next year, with a further 34% telling Canalys they expect such devices to make up less than 10% of their device sales across 2025.
The research found that the underlying value of AI PCs was not sufficiently clear to channel partners or their customers, in part due to a lack of availability.
George Fitzmaurice is a former Staff Writer at ITPro and ChannelPro, with a particular interest in AI regulation, data legislation, and market development. After graduating from the University of Oxford with a degree in English Language and Literature, he undertook an internship at the New Statesman before starting at ITPro. Outside of the office, George is both an aspiring musician and an avid reader.
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