Worldwide shipments of PCs, tablets and mobile phones are projected to decline by 4.4% this year to a total of 1.7 billion units, according to Gartner Inc.
The downturn would be the second consecutive year of reduced demand, following an 11.9% decline in 2022, the IT research group said.
"The depressed economic market will continue to dampen demand for devices throughout 2023. In fact, end-user spending on devices is projected to decline 5.1% in 2023," said Ranjit Atwal, senior director analyst at Gartner.
"Just as business confidence was beginning to recover after the worst of the pandemic, it has now fallen significantly in most regions. We do not expect relief from inflation and the bottom of the recession to occur until the fourth quarter of 2023."
That said, the downward trend affecting the market for devices is expected to lessen in 2023 on expectations of a less pessimistic economic outlook, eventually increasing consumer and business spending.
Personal computer shipments will continue to record the worst decline of all device segments, at 6.8%, after a 16% decline in 2022.
Gartner analysts expect PC inventory levels will return to normal by the second half of 2023 after increasing significantly in 2022.
"Inventory levels increased due to vendors overestimating market demand and because of the collapse in consumer confidence and a dramatic fall in demand," said Mr Atwal.
In 2022, while many business PCs could upgrade to the Windows 10 operating system, many did not. By the end of 2023, Gartner expects more than 25% of business PCs will upgrade to Windows 11. However, Windows 11 will not drive enough sales to reach the same volumes seen between 2020 and 2022.
In addition, as high inflation rates and the prospect of an impending recession decrease discretionary spending and budgets, Gartner estimates consumers and businesses will extend their PC and tablet replacement cycles by over nine months by the end of 2023.
Gartner forecasts worldwide smartphone shipments will decline 4%, to a total of 1.23 billion units, down from 1.28 billion in 2022.
"Consumers are holding onto their phones longer than expected, from six to nine months, and moving away from fixed to flexible contracts in the absence of meaningful new technology," said Mr Atwal.
"In addition, vendors are passing on inflationary component costs to users which is dampening demand further. End-user spending on mobile phones is projected to decline 3.8% in 2023."
