Worldwide shipments of desktop computers, laptops and workstations fell 21.2 per cent year-on-year to 58.1 million units in the third quarter of 2026, as higher component costs pushed up prices and weakened demand, according to research firm Omdia.

Desktop shipments, including desktop workstations, dropped 23.5 per cent to 11.7 million units, while laptop shipments, including mobile workstations, declined 20.6 per cent to 46.4 million units.

“After sustained pull-forward activity buoyed the PC market in the first half of the year, this sharp drop in shipment volumes comes as no surprise,” said Ishan Dutt, research director at Omdia.

He explained that the decline reflected warnings from major manufacturers during the previous earnings cycle, when they forecast double-digit falls in unit sales in the second half of the year.

Retailers have also reported double-digit increases in average selling prices alongside falling sales, as higher component costs have been passed on to consumers and business technology buyers.

Manufacturers and their production partners began cutting output in the third quarter, while distributors continued to work through high inventory levels.

Supply chain pressures have also intensified, with rising memory and storage costs compounded by shortages of processors, graphics cards and other integrated circuit components.

“The cost share of DRAM and SSDs in PCs has risen sharply from a typical level of around 15 per cent to nearly 40 per cent, with price increases more than fourfold,” said Ben Yeh, principal analyst at Omdia.

He added that repeated price increases by computer manufacturers had yet to fully offset the additional costs, warning that the pressures were likely to continue.

Omdia forecasts that the PC market will contract by 24 per cent in the fourth quarter of 2026, followed by a further 7 per cent decline over the whole of 2027.

Despite double-digit shipment declines among most leading manufacturers, the global rankings remained largely unchanged both quarter-on-quarter and year-on-year.

Lenovo retained first place, shipping 14.9 million units and holding a 26 per cent market share.

HP ranked second, with shipments falling 31 per cent to 10.3 million units, the steepest decline among the leading manufacturers. Its market share slipped to 18 per cent, almost three percentage points below the level recorded a year earlier.

Dell remained third with 7.6 million units and a 13 per cent share, while Apple held fourth place with 6.8 million units, an 11 per cent annual decline.

Apple nevertheless gained more than one percentage point of market share, as its premium positioning helped cushion the impact of higher prices.

Asus completed the top five, recording the smallest decline among the leading manufacturers, with shipments of 5.4 million units and its market share rising to 9.3 per cent year-on-year.

Artificial intelligence (AI) is reshaping the retail sector, with 80 per cent of retail leaders planning to increase investment in the technology, although cybersecurity threats and regulatory constraints could limit its benefits, according to professional services firm EY.

The firm’s CEO Outlook Survey found that 80 per cent of retail leaders were also optimistic about their ability to expand the responsible use of AI and customer data across their businesses, despite pressure on costs and prices, geopolitical disruption and economic uncertainty.

However, EY warned that greater reliance on AI could expose weaknesses in retailers’ strategies, governance and operating models, particularly as digital adoption increases the risks surrounding customer privacy and cybercrime.

The survey found that 24 per cent of retail leaders identified cybersecurity and data privacy threats as a leading business risk for the following year.

EY said retailers should prepare for different possible futures rather than assume current investment trends would continue uninterrupted.

Its analysis uses a four-scenario framework developed by Jim Dator of the University of Hawaii.

The scenarios range from a constrained future, in which economic pressures, regulation, cyberattacks, outdated systems and poor data restrict AI adoption, to continued growth through sustained investment.

A third scenario envisages a fundamental transformation of society and the economy around new technologies, while a fourth considers systemic breakdown, in which a small number of powerful technology platforms dominate access to AI models and charge premium prices, potentially restricting access to larger retailers.

In a more constrained future, retailers could focus AI investment on lower-risk back-office functions such as finance, procurement, inventory management and logistics, while customer-facing applications struggle to expand amid regulatory uncertainty and declining public trust.

EY highlighted the European Union’s AI Act, China’s state-led AI governance and interventions by individual US states as examples of regulatory measures shaping the sector.

At the same time, cyber threats are increasing as malicious uses of AI develop.

The World Economic Forum’s Global Cybersecurity Outlook 2026 found that 87 per cent of organisations had experienced rising cyber risks linked to AI vulnerabilities, while 94 per cent expected malicious AI to have a significant effect on cybersecurity in 2026.

EY said retailers were particularly exposed because customer data, payment systems, older technology infrastructure and complex supply chains create numerous potential points of attack.

The firm said retailers’ future success would depend on combining technological investment with clear strategies that account for different possible outcomes.