IDC: PC Market Returns To Growth After Two Years Of Decline

Now that a gradual recovery has brought the PC market back growth, IDC believes there are greener pastures ahead because of the emerging category of AI PCs combined with the expectation that businesses will seek to replace aging devices.

Research firm IDC said the global PC market returned to growth in the first quarter of 2024 after two years of decline, which allowed shipments to nearly reach pre-pandemic levels in 2019.

Global PC shipments reached 59.8 million in the first quarter, marking a 1.5 percent year-over-year increase from the same period last year, according to IDC.

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This was made possible by the fact that the PC market experienced its “lowest point” in history in the first quarter of 2023, when shipments declined 28.7 percent year-over-year, the firm said.

IDC pointed out that total PC shipments for the first three months of 2024 rivaled the 60.5 million units shipped in the first quarter of 2019. That was roughly a year before the COVID-19 pandemic prompted a massive spending spree on PCs and peripherals in 2020 and 2021, which was then followed by a precipitous drop in demand in 2022 and 2023.

But now that a gradual recovery has brought the PC market back into growth mode, IDC believes there are greener pastures ahead for vendors and component makers.

This is largely due to the emerging AI PC category that is expected to double in growth this year and again in 2025, when it is forecasted to represent 43 percent of total shipments, the firm said in a previous report. IDC expects that share to reach nearly 60 percent by 2027.

IDC also believes many businesses are looking to refresh PCs they purchased near the beginning of the pandemic. (There’s also an expectation that Microsoft’s end of support for Windows 10 in 2025 will prompt a replacement of devices that aren’t compatible with Windows 11, research firm Circana told CRN in a recent interview.)

"Despite China's struggles, the recovery is expected to continue in 2024 as newer AI PCs hit shelves later this year and as commercial buyers begin refreshing the PCs that were purchased during the pandemic," said IDC Research Manager Jitesh Ubrani said in a statement.

"Along with growth in shipments, AI PCs are also expected to carry higher price tags, providing further opportunity for PC and component makers,” he added.

The first wave of AI PCs emerged last year thanks to AMD’s Ryzen 7040 processors and expanded further at the beginning of the year with Intel’s Core Ultra processors.

The market will get another boost later this year when mobile chip giant Qualcomm releases its Snapdragon X processors for Windows PCs.

All these processors come with a neural processing unit (NPU) in addition to a CPU and GPU to handle a wide variety of AI workloads, including large language models.

Major PC vendors like Lenovo, HP Inc. and Dell Technologies have started to make a major push for AI PCs over the past few months. Meanwhile, Apple has started to boast about the AI capabilities of its Mac computers thanks to its custom M-series chips, promising to reveal what it calls “incredibly” exciting generative AI features later this year.

An executive at a major U.S. distributor told CRN recently that he believes market demand for AI solutions will help drive a PC refresh that starts this year and continues into 2025. He likened the dynamic to when Intel debuted its Centrino brand for wireless computer networking in 2010, which kicked off a new wave of demand for PCs.

“I think AI is that kind of disrupting market force that's going to create this refresh cycle,” said Kent Tibbils, vice president of marketing at Fremont, Calif.-based ASI.

However, he added, the exact timing of the refresh cycle will depend on how fast independent software vendors are to take advantage of new processors from Intel, AMD and Qualcomm.

“I do think it'll take place in the enterprise or on the commercial side first, and that'll be more impactful than the consumer side,” Tibbils said.

Lenovo Keeps Top PC Spot While Apple Grows Faster

Lenovo maintained its No. 1 spot in global PC market share and had the third fastest growth rate out of the market’s top five vendors in the first quarter of 2024, according to IDC.

The Chinese tech giant grew PC shipments by 7.8 percent year-over-year to 13.7 million, the research firm said. The vendor with the second fastest growth rate was Acer, which grew 9.2 percent to 3.7 million units shipped. This created a statistical tie for No. 5 with Asus, whose shipments declined by 4.5 percent to 3.6 million units.

Apple, however, grew the fastest, increasing shipments by 14.6 percent to 4.8 million units. The Cupertino, Calif.-based company ranked No. 4 on the list.

HP, on the other hand, was No. 2 and saw close to no growth with 12 million shipments in the first quarter. Dell ranked just behind at No. 3 and saw shipments decline by 2.2 percent to 9.3 million units, making it the only other major vendor besides Asus to experience a decrease.