Insights

The PC Recovery, Driven by AI, Remains Elusive

Written by Larry Walsh | Nov 27, 2024 2:00:00 PM

Weak PC sales in the third quarter are signaling that the anticipated PC refresh cycle won’t materialize until 2025. The main challenge? A failure to demonstrate the value of AI in PCs.

At the start of 2024, analysts forecasted modest growth in PC sales. IDC projected a 3% increase, fueled by the release of AI-enabled and -optimized devices and the end of life for Windows 10. A stronger 7% uptick was predicted for 2025, driven by the same factors. But these optimistic projections overlook a core issue: Channel partners and their customers remain unconvinced about the benefits of AI-powered PCs.

Despite early hopes, PC sales have remained underwhelming. Dell reported a 1% decline in PC revenue for the third quarter, while HP saw only a modest 2% gain. For two of the largest PC vendors globally, these results point to a significant gap in market readiness. Channel partners, tasked with conveying the value of these new devices, face an uphill battle when businesses see little incentive to upgrade.