HP (HPQ.US) Cools Down PC Industry Expectations: Shipments to Decline in 2027, Can "Growth-Driven Revenues" Hold Up?

According to Zhitong Finance APP, HP (HPQ.US) has thrown cold water on the PC industry in its filing to the U.S. Securities and Exchange Commission (SEC): the company’s preliminary planning assumes that the industry-wide PC shipments will decline by a mid-single-digit percentage in the 2027 calendar year compared to 2026. HP (HPQ.US) shares dropped more than 5% in pre-market trading on Monday, Apple (AAPL.US) shares also slipped slightly pre-market, while Dell Technologies (DELL.US) rose 2.3%.

HP added, "This planning assumption depends on the market performance in the second half of the 2026 calendar year, which remains uncertain and may change." This disclosure does not mean the company is providing financial guidance for 2027.

This pessimism is not unique to HP. A Goldman Sachs July research report projected that global PC shipments would shrink by 14% to 255 million units in 2026 and then decrease another 5% to 243 million units in 2027; Omdia estimates a 4.9% drop in U.S. market shipments in 2027; IDC predicts that after an industry-wide average price increase of about 20% in 2026, average prices will continue to rise moderately in 2027, with shipments continuing to contract.

Can “declining volume and rising prices” protect profit margins?

Despite HP rising by about 60% year-to-date, its ratings structure is obviously bearish: in the bearish camp, Morgan Stanley maintains an "Underweight" rating with a target price of $19; Barclays rates it "Underweight" with a target price of $23; Goldman Sachs’ latest rating is "Sell" with a target price of $21; Bank of America gives it an "Underperform" rating, with a target price of $18–21.

Morgan Stanley pointed out that HP’s Q3 revenue increase of +12.5% YoY to $15.7 billion was entirely driven by price hikes, not volume—as PC shipments dropped by 16% YoY during the same period. Morgan Stanley expects double-digit declines in unit shipments to continue until FY2027, citing that rising storage prices are suppressing demand; and AI PCs only "substitute" the existing commercial replacement demand, not increase the total. Once HP is forced to promote sales to maintain market share, combined with rising component costs, margins will be squeezed from both sides.

Bulls, on the other hand, are betting on structural improvement: Investment banks like Bernstein, Evercore, and UBS estimate that commercial demand accounts for about 75% of the PC market, and regulated industries (financial, medical) tend to deploy AI computing power locally, supporting high-end model demand. While UBS has raised its target price to $28, it also warned that the recent surge in commercial demand may be due to early stocking ahead of price hikes—Omdia bluntly said that Q2 shipments this year were "borrowed from 2027."

The common industry driver is storage shortages caused by AI: HBM/DRAM capacity is prioritized for AI data center clients, and SK Group Chairman Chey Tae-won publicly stated that 2027 will be the most severe year of supply-demand imbalance in storage history.

There is already a general consensus on Wall Street about "continued declines in PC shipments in 2027"; the real battleground is whether revenue propped up by price hikes can translate into profit. The next verification point will be HP’s fiscal Q4 earnings in November, when the company will announce cost-cutting measures and formal guidance for fiscal year 2027, which will also become the first touchstone in the timetable for both the bulls and the bears.

Who Can Survive the PC Winter?

On the day HP issued a warning, Dell rose 2.3% in pre-market trading, reflecting a brief shift in funds. But the underlying logic remains unchanged: Dell also faces cost pressure from rising storage prices. Although its PC business revenue grew about 20% YoY, shipments were likewise under pressure (according to IDC). UBS clearly pointed out that "this is a problem both HP and Dell have to face, and the numbers have already started to show it." Dell’s advantage lies in its higher proportion of server and AI infrastructure business, making the PC winter’s impact on its profit structure more manageable—which is precisely why funds quickly rotated from HP to Dell within two days.

Apple saw a slight decline in pre-market trading on Monday. The market’s concern for Apple centers on the consumer segment—consumers are highly price-sensitive, and faced with a roughly 20% increase in PC average selling prices, the likeliest choice is to delay replacement. Acer chairman Jason Chen’s judgment on September 20 is more representative: He expects double-digit declines in shipments, but revenue may not fall correspondingly; DDR4/DDR5 supply has already turned ample, and PC average prices may peak around mid-2027. For second-tier manufacturers like Acer and Asus, which focus on consumer models and lack commercial premium and subscription ecosystems, the risk of being hit by both volume and price declines is the greatest.