Manufacturing PCs is not a high-margin business. There's a lot of competition, and outside of specialty segments like gaming PCs, there's not much differentiation. A mainstream laptop from HP (NYSE: HPQ) is going to be very similar to a mainstream laptop from Dell or Lenovo.

The pandemic flipped the PC industry on its head. Insatiable demand, driven by working and learning from home coupled with supply chain constraints and shortages, created a bonanza for HP and other PC manufacturers. Not only did sales soar, but so did profits. At its quarterly peak, the adjusted operating margin in HP's personal-systems segment topped 8%.

That's not normal, and it was never going to last. Historically, HP managed operating margins closer to 4% in the PC business. Margins could be a bit higher during periods of strong demand, but a doubling of margins was a pandemic anomaly.

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Source Fool.com