Institution: There are two major trends in the global notebook computer market in 2023 that deserve special attention

It has been more than a year since TV panel prices fell from highs. The Chromebook's fall from the cloud also lasted a year. Other epidemic demand during the outbreak has also dropped significantly. After 10 years of growth, Netflix's subscriber numbers fell for the first time in the first quarter of 2022. Sony said gamers are going outside, which is hurting sales of its PlayStation console.

On November 8, DIGITIMES Research published an analysis and judgment on the trend of the global notebook computer market in 2023.

The article pointed out that whether it is mobile phones, notebooks or TV sectors, from the fourth quarter of 2022 to the first half of 2023, clearance is the main focus in the short term. Specifically for notebooks, the progress of front-end clearance is still slow.

Can the industry rebound in the second half of 2023? The industry is also uncertain, there are many black swans and grey rhinos in the market. In the long run, looking at the industry's development over the past two years, there are a few things that can give clues to what's to come. For the notebook supply chain, there are two expected trends.

1. Laptops continue to flourish, returning to 200 million units/year

Currently, the notebook supply chain expects the industry to decline by 20-25% in 2022. DIGITIMES Research predicts that notebook shipments in 2022 will be 190 million units, a year-on-year decrease of 22.8%. Looking ahead to 2023, supply chain estimates, both growth and decline, are likely to be in the single digits.

In any case, the industry has reached a consensus that notebook shipments will return to the 200 million threshold. Compared to previous years when shipments stagnated at around 150 million units, the notebook supply chain is now relatively optimistic about the future of the industry. The main reason is that notebook demand gained momentum during the two-year epidemic.

During the pandemic, notebooks are an important tool for those studying/working from home. Devices that once threatened laptops, such as smartphones, have taken a backseat due to usage habits and cost-effectiveness. Smartphones are simply not suitable for tasks like filling out Excel sheets for long periods of time.

In addition to consolidating product demand, the age range of notebook users is also expanding. School-aged children who previously had no access to PCs have already done so due to the massive introduction of distance learning during quarantine. When families or schools purchase laptops for remote instruction, school-aged children's use of laptops increases significantly, even as most schools have resumed in-person classes. Once kids get their hands on a notebook and enjoy the convenience, it's hard for them to let go.

The result is that the notebook's user age group can scale down. Once this demand is activated, it is difficult to recover, and this creates momentum. Furthermore, with the global population reaching 7.9 billion and continuing to grow, demand for laptops will have some basis unless alternatives are created.

2. Intel's leading position will continue to be challenged, and the ARM architecture will rise.

Intel has fallen behind in product development over the past few years, giving rivals the best chance to outpace it. While AMD has yet to overtake Intel, it is no longer Intel's insurmountable lead as the gap between the two continues to narrow. Recently, Intel raised the price of its active processors, but AMD chose not to follow. This could increase AMD's market share in the PC space.

In the fourth quarter of 2016, Intel's market share in the PC segment, which includes desktops and laptops, peaked at 82.2 percent, according to market research firm Statista. At the time, AMD's market share was 17.8%. After that quarter, however, the two have been trending in opposite directions. By the second quarter of 2022, Intel's market share fell to 63.5%, while AMD's market share was as high as 36.4%.

The notebook supply chain expects AMD to continue its upward trend in the second half of 2022. DIGITIMES Research estimates that Intel's market share in notebook processors will fall to 63.9% in 2023, while AMD will rise from 22.5% to 23.9%, an increase of 1.4 percentage points.

Another growth force is Arm, whose market share will reach 13.9% in 2023. This growth in ARM-based processors comes from two waves of hardware shipments: Chromebooks and Apple's Macs.

The first is a Chromebook. Before the pandemic, Chromebooks were limited to outside the education market. However, Chromebook sales tripled due to government procurement, the pandemic and the subsequent mass introduction of distance learning. Chromebooks in 2022 saw a significant drop compared to 2020/2021.

Industry insiders estimate that Chromebooks won't fully recover in 2023. In the best-case scenario, it could see single-digit growth. The main reason is that large-scale government purchases over the past two years are being halted as the outbreak eases. Still, there are some new demands, as Chromebook users are students and more likely to break the device.

Notably, Chromebooks are expanding from the education market to the enterprise and personal consumer markets. Industry insiders pointed to higher-than-expected sales of the high-end Chromebook and speculation that it is being sold in the enterprise market. In the long run, Google's recently released ChromeOS Flex system may also help.

Another impetus comes from Apple. Apple has been developing its own processors for use in Macs for years. By 2022, all models switch to the M-series, which in turn drives a rapid jump in Arm-architecture processors. According to DIGITIMES Research, its market share rose from 0.5% in 2019 to 6.8% in 2021 and 11.8% in 2022.

Today, the Wintel brand is comparing its products to Apple's line of Macs to determine their strengths and weaknesses, industry insiders point out. The M series not only broke the single-digit market share ceiling that limited Arm processors in the past, but also increased Apple's market share in the notebook field. In 2022, Apple's market share will reach double digits, a peak in the past five years.

In the past, Arm processors emphasized their low power consumption. With Intel focused on performance, Arm struggled to break through. However, with Apple's M-series presenting a serious challenge to Intel's Core i processors, the idea that the ARM architecture is inferior to Intel's performance is being overturned. This change is a major issue that Intel and AMD will have to address head-on in the future.