AI to drive up PC prices but not shipments, says IDC

Market news | June 11, 2024

By Peter Clarke

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AI-capable personal computers will raise the average selling price of personal computers but make little impact on overall PC sales over the next few years, according to market analyst IDC.

In 2024 the traditional PC market will remain flat with some refresh-driven purchase in the west balanced by reduced sales in China due to economic woes, IDC said.

IDC expects PC shipments to reach 260.2 million units despite the advent of PCs with neural processing units on-board, so-called AI PCs. This global forecast is hindered by China where inventory is high. Excluding China, the PC market is forecast to grow 2.6 percent year-over-year in 2024 while the PC market in China is not expected to recover until 2H25, IDC said.

Global desktop and notebook computer market share by NPU performance. Source: IDC.

Factors influencing the rest of the world in 2024 include:

An education refresh cycle as 29.6 million PCs are shipped to this market. However, lower budgets means that the refresh cycle will be spread over multiple years rather than producing the spike seen during the pandemic
A Windows 11 driven refresh as end-of-support for Windows 10 happens late 2025.
Consumer purchases of PCs will decline 1.1 percent in 2024. However, if China is excluded from that comparison shipments will increase by 1.6 percent.
In the consumer sector, near-term interest in smartphones could subdue PC purchases.

IDC said that AI PCs based on Qualcomm’s ARM-based silicon and on parts from AMD and Nvidia arriving later this year will drive some sales in the near-term. But said that AI-PC is essentially part of the refresh cycle and does not expand the market. AI PCs are not likely to drive shipment volume but are forecast to help vendors increase average selling prices, IDC said.

“While the noise around on-device AI may seem a bit unwarranted due to the lack well-defined use cases for business and enterprise users, these devices will bring with them a momentous shift in computing by offering content generation and increased productivity over the next few years,” said Jitesh Ubrani, a research manager with IDC. “However, consumer adoption will likely take longer as educating users on the benefits of on-device AI vs cloud-based solutions won’t be a straightforward task.”

IDC said that eventually AI will be ubiquitous in PCs with ramping up from 20 percent market share in 2024 to two-thirds of the market by shipments in 2028.