Why are computer orders holding up so well?
Durable goods orders picked up in February after falling the previous two months. Part of that increase was orders for new aircraft and aircraft parts, machinery and fabricated metal products. Another part was orders for computers — up 3.1%. This has been a strong category for the last couple of months now.
Right around this time four years ago, COVID-19 pandemic was shutting down much of the world.
“Well, we were in the whole lockdown rush of everyone has to go home and work from home,” said Paddy Harrington, a senior analyst at consulting firm Forrester.
A lot of people who worked in offices had desktop computers that they couldn’t easily bring home with them, he said.
So what did companies do? They bought a lot of laptops for their employees to work from home.
A lot of people also bought themselves new personal computers early in the pandemic, when there wasn’t much to go spend money on outside the house.
Now, Janet Tang, a partner and managing director at AlixPartners, said it’s just time for a lot of those people and companies to replace or refresh those computers.
“There’s a natural refreshment cycle,” she said. “I use a computer for three years? It’s time to get a new model.”
On average, Tang said people buy new computers every three years or so. So a lot of this is just cyclical.
There is another factor that could be playing a smaller role here too, she said: new computers that have artificial intelligence capabilities.
“All the major computer vendors have already announced their new products coming out with AI capability installed into the computers,” she said. “That’s something that’s fairly new to the market.”
She said people and companies that like to keep up with the latest, newest tech might be compelled to try them out.
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