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Education spending slowdown hits tablets and Chromebooks

Q2 market analysis from Canalys charts further shipment declines, but positives are sounded for those in the channel sitting on inventory

Weaker education sales and lower consumer demand has continued to blight the Chromebook and tablet markets.

Analysis from Canalys has tracked a year of decline in both form factors, with the second quarter of 2022 continuing a trend in shipment declines that started in 2021.

Those selling the hardware have had to contend with component shortages and rising inflation, but there are also a couple of specific issues in the tablet and Chromebook space that have contributed to respective 11% and 57% year-on-year second-quarter drops in shipments.

Tablets were in strong demand during the pandemic, but that wave of interest has ebbed away and the latest disappointing quarter adds to the picture of a market recalibrating after the pandemic. All of the market leaders, apart from Amazon, saw declines as the market continued to suffer.

“The rapid fall in consumer and education demand has accelerated the decline in tablet shipments as we move further from the peak of the pandemic,” said Canalys analyst Himani Mukka.

“Inflation and fears of a recession are at the forefront of consumers’ minds, and spending on tablets has taken a backseat as the need for pandemic-era levels of use has fallen. Unlike notebooks, tablets are not vital for business productivity, so commercial demand has not helped to offset the drop in consumer purchases,” she added.

“On the commercial side, the outlook is more optimistic, though shipments remain relatively small,” said Mukka.

For Chromebooks, the drop in activity among education buyers was the main problem, but market leader Acer was able to weather the storm slightly better than some of its competitors.

“Chromebooks have now been hit by year-on-year shipment declines every quarter since the third quarter of 2021,” said Brian Lynch, research analyst at Canalys.

“This period of negative growth has been an expected transition following the saturation of the category’s two largest education markets, the US and Japan. Now, the global Chromebook market is set for a period of more consistent performance, with lower shipment numbers and more traditional seasonality than was seen during the pandemic,” he added.

Lynch warned that the situation was challenging for the channel, which was holding stocks of Chromebooks, as the market settled down after Covid.

“In recent months, there has been a major buildup of Chromebook inventory in the channel amid the slowdown in demand. While mostly due to waning education demand, Chromebooks have also struggled in the enterprise segment of late. Channel partners have signalled a conservative outlook on the market’s growth prospects and many still don’t carry the category,” he said.

Lynch added that there were reasons to be optimistic that those inventories would be called on, however. “Future digital education initiatives in a variety of countries will continue to focus on Chrome OS devices, offering renewed growth opportunities,” he said.

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