Worldwide PC shipments will fall by 6.4% for the full year 2016, according to the recently updated forecast from the International Data Corporation (IDC) and its Worldwide Quarterly PC Tracker.
The research firm noted this updated forecast was actually an improvement over the previous outlook for a 7.2% decline that it released back in August. The IDC left its 2017 forecast for a 2.1% fall in PC shipments intact, but noted that absolute volumes could actually come in slightly higher than 2016 levels.
In the third quarter, PC makers shipped 4.6% less computers than in the prior year period, which was much better than expectations for a 6.6% decline.
Behind the PC’s decline is the proliferation of smartphones and tablets, both of which offer much of the same functionality as traditional computers, but aren’t counted in traditional PC shipment metrics. Lower numbers of computers shipped are bound to have negative ramifications for companies like Microsoft, IBM, Apple, and Hewlett-Packard, which have large amounts of exposure to the PC industry.
Those companies are also large constituents within the Technology SPDR ETF (NYSE:XLK), which fell $0.38 (-0.79%) to $47.69 per share in Wednesday afternoon trading. Year-to-date, the largest fund tied to tech stocks has gained 11.39%, outpacing the benchmark S&P 500’s 8.5% return during the same period.