HP (HPQ.US) personally threw cold water on the PC industry: Shipments declined in 2027, can the “rising revenue” still hold up?
The Zhitong Finance App notes that the documents submitted by HP (HPQ.US) to the US Securities and Exchange Commission (SEC) have thrown cold water on the PC industry: the company's preliminary planning assumes that the 2027 calendar year PC shipments will drop by about a mid-single digit percentage compared to 2026. HPQ.US (HPQ.US) shares fell more than 5% in the pre-market on Monday, Apple (AAPL.US) shares also fell slightly before the market, while Dell Technologies (DELL.US) rose 2.3%.
HP added, “This planning assumption depends on market performance in the second half of the 2026 calendar year. Currently, there are still variables and are subject to change.” This disclosure does not mean that the company is providing financial guidance for 2027.
This isn't the HP family's pessimism. Goldman Sachs's July research report predicts that global PC shipments will drop by about 5% to 243 million units in 2027 after falling 14% to 255 million units in 2027; Omdia expects US shipments to fall 4.9% in 2027; IDC predicts that after the average industry price rises by about 20% in 2026, the average price will continue to rise moderately in 2027, and shipments will continue to shrink.
Can “volume decline and price increase” maintain profit margins
Against the backdrop of HP's sharp rise of about 60% since the beginning of the year, the rating structure is clearly flawed: in the bearish camp, Morgan Stanley maintains a “reduced holdings” with a target price of $19; Barclays has a “low profile” rating with a target price of $23; Goldman Sachs's latest rating is “sell” with a target price of $21; and Bank of America has given a “outperforming market” rating and a target price of $18-21.
According to Damo, HP's Q3 revenue +12.5% year over year to $15.7 billion came entirely from price increases rather than sales — PC shipments fell 16% year over year. Damo expects the double-digit decline in unit shipments to continue until the 2027 fiscal year. The reason is that storage price increases suppress demand; while AI PCs only “replace” existing commercial switching demand, there will be no increase in total volume. Once HP is forced to promote its share in order to guarantee its share and increase component costs, profit margins will be squeezed in both directions.
Bulls' objections are betting on structural improvements: investment banks such as Bernstein, Evercore, and UBS expect commercial demand to account for about 75% of the PC market, and regulated industries (finance, healthcare) tend to deploy AI computing power locally to support demand for high-end models. Although UBS raised its target price to $28, it also warned that the recent commercial strength may be early delivery before the price increase — Omdia put it bluntly that this year's Q2 shipments were “borrowed from 2027.”
A common driver at the industry level is the shortage of storage brought about by AI: HBM/DRAM production capacity is prioritized for AI data center customers, and SK Group Chairman Choi Tae-won publicly stated that 2027 is the year with the worst imbalance between supply and demand in storage history.
Wall Street has basically reached a consensus on “PC shipments will continue to decline in 2027” itself; the real battleground is whether the revenue supported by price increases can be turned into profit. The next verifiable node is HP's November fiscal year Q4 results. At that time, the company will announce cost reduction measures and official guidance for fiscal year 2027, which will also be the first litmus test for both long and short timelines.
Who can survive the PC winter
On the day of HP's warning, Dell bucked the pre-market trend and rose 2.3%, and there was a brief shift in funding. However, the basic logic is the same: Dell is also facing the cost squeeze of rising storage prices. Although its PC business revenue increased by about 20% year over year, shipments were also under pressure (IDC caliber). UBS clearly stated, “This is a problem that both HP and Dell must face, and it is already beginning to be shown digitally”. Dell's advantage is that it accounts for a higher share of the server and AI infrastructure business, and the impact of the PC winter on its profit structure is relatively manageable — this is why the capital “moved” from HP to Dell within two days.
Apple dropped slightly before the market on Monday. The market's concern about Apple is on the consumer side — consumers are highly price sensitive. Facing a PC with an average price increase of about 20%, the most likely option is to delay switching. Acer Chairman Chen Junsheng's judgment on September 20 is more representative: shipments are expected to decline by double digits, but revenue may not decrease at the same time; DDR4/DDR5 supply has become abundant, and average PC prices may peak in mid-2027. For second-tier manufacturers, such as Acer and Asus, which mainly focus on consumer models and lack commercial premiums and subscription ecosystems, the risk of losing volume and price is greatest.