While business tech spending trends are mixed right now, there aren't many soft spots within consumer tech spending, as numbers shared over the last couple of weeks highlight.
With many consumers still spending a lot more time at home than usual, and with travel and hospitality spending still far below pre-COVID levels, demand for PCs, tablets and gaming hardware all still look very good, as does total e-commerce activity and spending on games and streaming services.
And while smartphone demand is still a little soft, commentary from Apple (AAPL) and others suggest things look a lot better right now than they did in March and April.
Last week, research firm NPD estimated that total U.S. consumer tech spend -- a very large percentage of which is now happening via e-commerce -- was up 34% annually during the first week of August, following an 18% increase in July. Notebook sales were estimated to be up 64%, while sales of monitors, routers and PC headsets were respectively estimated to be up 97%, 87% and 127%.
HP (HPQ) and Dell's (DELL) Thursday earnings reports reinforced just how strong consumer notebook spending is right now, thanks to purchases made to support remote work and learning.
While HP's PC unit saw its sales to commercial clients drop 6% annually during HP's July quarter, its sales to consumers rose 42%. That consumer strength helped HP's total notebook unit sales rise 32%, offsetting a 30% drop in desktop units (largely due to corporate weakness).
Dell reported that its PC unit's consumer revenue rose 18% annually, partly offsetting an 11% drop in commercial sales. The company added that consumer notebook and gaming PC sales both saw strong double-digit growth.
Also: Both HP and Dell signaled on their earnings calls that they expected notebook demand from consumer and education end-markets to remain strong this quarter. HP did caution that its dealing with some CPU and display panel supply constraints.
Separately, a week before HP and Dell reported, Nvidia (NVDA) reported that its Gaming segment (it covers sales of gaming GPUs and game console processors) saw revenue grow 24% sequentially and 26% annually during its July quarter.
Nvidia, which is expected to unveil a major gaming GPU refresh at a Sep. 1 event, also guided for Gaming revenue to be up over 25% sequentially during its October quarter. And CEO Jensen Huang declared that he thinks the second half of 2020, which will also see Microsoft (MSFT) and Sony's (SNE) next-gen consoles arrive, might be "one of the best gaming seasons ever." Nvidia's numbers and comments followed the arrival of very strong Q2 numbers from game publishers and Nintendo.
Recent U.S. payment card spending data also suggests consumer tech and e-commerce spending remains solid.
Though still showing a roughly 9% annual drop in total spending due to declines in areas such as travel, hospitality and fuel, JPMorgan's Chase consumer card spending tracker is still registering a high-single digit increase for "card not present" transactions (similar to July), thanks to strength in e-commerce and other online transactions.
Going forward, there is some risk that the lack of a new stimulus bill will weigh on consumer spending, and perhaps also cause ripple effects that lead to additional corporate and government job cuts. With extra federal unemployment insurance benefits having been cut in half to $300 (and many states not having yet begun sending out those checks), card spending data from Bank of America points to spending drops in the first half of August among UI recipients, particularly poorer ones.
At the same time, BofA's data does suggest that spending among all other consumers rose moderately during the first half of August. Improved consumer confidence might be helping, and so might a wealth effect from higher stock and home prices.
And right now, all signs suggest that an outsized share of the discretionary consumer spending that is going on continues going towards tech products and services.
