Everything is ready, just waiting for the right moment.

In the first half of 2024, the PC industry witnessed a rare resurgence.

First, in the first quarter, the global PC market finally resumed growth after two consecutive years of decline, with shipments reaching 59.8 million units, an increase of 1.5% year-on-year. At that time, we pointed out that two factors, new product stimulation and the concept of AI PCs, drove the global PC market out of the winter.

And according to the latest data, the global PC market not only continued to grow in the second quarter but even expanded its growth rate.

Figure/ IDC

The latest data from market research firm IDC shows that in the just-concluded second quarter of 2024, the global PC market shipped a total of 64.9 million units, an increase of 3% year-on-year, double the growth rate in the first quarter. Even excluding China, global PC shipments grew by more than 5% year-on-year in the second quarter.

Specifically, among the top five vendors, Lenovo continued to hold the top spot as the world's largest PC vendor, with shipments increasing from 14.2 million units in the same period last year to 14.7 million units, a growth of 3.7%, and its market share also increased by 0.2% to 22.7%. HP and Dell, ranked second and third, did not perform well, with Dell even experiencing a 2.4% decline.

In contrast, Apple and Acer were undoubtedly the bigger "bright spots." Not only did they significantly outperform other vendors in growth rates in the first quarter, but their growth rates continued to accelerate in the second quarter, far exceeding the overall market and driving overall market growth to some extent.

In particular, Apple's shipments increased by 20.8% year-on-year, from 4.7 million units to 5.7 million units; Acer also had a 13.7% increase, with shipments rising from 3.9 million units to 4.4 million units.

M3 MacBook Air, Figure/ Apple

As Ryan Reith, Vice President of IDC's Worldwide Device Tracker, said, two consecutive quarters of growth, coupled with extensive market promotion around AI PCs and the arrival of an important commercial refresh cycle, are boosting the global PC market.

Combining the situation in the PC market in the first and second quarters, the changes that occurred in the PC market in the first half of this year are likely to be the major trend of the PC industry for several years to come.

The PC market is changing in the first half of 2024

Over the past six months, the PC industry has once again become the focus of public opinion, not only because of the long-awaited growth but also, more importantly, because of the driving forces behind that growth.

AI is, of course, a core element that cannot be avoided. In fact, since ChatGPT, PCs have regained more attention, and most AI tools tend to prioritize PCs before gradually covering mobile phones.

The key reason behind this is that the PC platform has a natural advantage in information input and output, whether it's a larger display screen or a more efficient text input method, which is precisely the most disruptive capability of this round of AI transformation—large language model technology.

And in 2024, as AI applications based on large model technology continue to emerge, collide, and go viral, more and more ordinary people are beginning to use AI in their daily work and studies, and PCs have naturally attracted more use and discussion.

But PCs obviously don't want to stop at just "building the stage"; they also want to personally "perform" in the AI era.

2024 is called the first year of AI PCs for a reason. From the beginning of the year to the middle of the year, almost every mainstream PC vendor has been intensively launching new AI PC products.

Figure/ Lenovo

On April 18, at the 10th Lenovo Tech World, Lenovo launched six AI PCs at once. Even Apple introduced a new MacBook Air with the M3 chip on March 4, calling it "the world's best consumer AI laptop."

Many more vendors are also launching their AI PC products, from Dell, HP, ASUS, Acer, to Honor, Huawei, and Microsoft.

At the same time, a new round of refresh cycles is also driving an overall increase in global PC shipments, especially for commercial PCs. Four years ago, the COVID-19 pandemic triggered a large-scale refresh of PCs worldwide, and the PCs purchased at that time are now approaching their performance and functional limits.

The IDC report points out that many commercial PCs are currently used for more than four years, and businesses are beginning to seek upgrades to improve work efficiency and security.

Of course, the update of Windows 11 and AI PCs are also key factors driving businesses to update their PCs, but this driving effect may only start in the second half of the year. The same is true for the consumer market, as before June, it was difficult to call AI PCs on the market truly AI PCs, and they did not offer a significant difference in usage compared to traditional PCs.

AI PCs gain momentum, but the second half of the year is the main event

Fairly speaking, although some consumers with professional needs and technology enthusiasts have begun to pay attention to the AI performance and related AI functions and applications of PCs when purchasing laptops, it is clear that the "AI" of most AI PCs currently on the market is far from being a key factor influencing the purchasing decisions of most consumers.

Before the launch of Qualcomm X Elite Windows PCs, so-called AI PCs from vendors "did not offer a significant difference in usage compared to traditional PCs." For example, AI chatbots, currently the largest user base of AI applications, do not actually rely on the hardware itself, and vendors' previously declared AI PCs and traditional PCs function the same. WPS AI, Notion AI, Microsoft Copilot, and a large number of AI applications are all like this.

It's not that vendors haven't tried to change this situation.

Figure/ Intel

Since the end of last year, Intel has collaborated with PC vendors to host various artificial intelligence innovation application contests, hoping to attract developers to build edge AI applications based on Ultra processors, and has also launched an AI PC Acceleration Program to attract independent software vendors (ISVs).

In addition, Lenovo officially launched the "Lenovo Xiao Tian" personal AI agent in April, proposing five key features of AI PCs, including built-in personal large models, local heterogeneous computing power, personal knowledge bases, personal data and privacy protection, and an open AI application ecosystem.

But first, computing power is a fundamental issue.

As we all know, the development of cloud-based large models is limited to a certain extent by computing power, and the same is true for terminals. In fact, most AI PCs in the first half of this year provided AI computing power through heterogeneous computing, which refers to the process of using CPUs, GPUs, and NPUs to participate in AI acceleration calculations together.

However, "heterogeneous computing" is not reasonable on laptops, not only occupying CPU and GPU computing resources, easily affecting daily usage experience, but also having power consumption issues.

Having an NPU with sufficient computing power is the "version answer" for the PC industry.

On June 18, the first batch of Windows laptops equipped with Qualcomm X Elite finally went on sale, including Microsoft's latest Surface Laptop and Surface Pro, Acer Swift Go Pro AI, and ASUS VivoBook Pro 15 2024 Qualcomm Edition. Subsequently, Qualcomm X Elite/Plus Windows PCs from various vendors are being launched in succession.

If we follow Microsoft's requirements for AI PCs, the core standard for Windows 11 AI PCs is that the NPU has at least 40 TOPS of AI computing power, and currently, only the latest batch of Qualcomm X Elite/Plus Windows PCs on the market can be considered "AI PCs."

Dell XPS 13 Qualcomm Edition, Figure/ LeiTech

The reality is that there are still very few Windows PCs equipped with Qualcomm X Elite/Plus on the market, and more new products will be launched in the second half of the year. At the same time, not only Qualcomm but also Intel and AMD have recently unveiled their next-generation PC chips at Computex Taipei, with the commonality being that their NPUs can independently provide more than 40 TOPS of AI computing power, and the corresponding models will also be officially launched in the second half of the year.

Only when the computing power is sufficient can the latest version of Windows 11 and third-party AI applications become prevalent on PCs, and AI PCs can truly come into their own in the second half of the year.

Qualcomm re-enters the game, PC chips experience another upheaval

In addition to the arrival of refresh cycles, the update of Windows 11, and the popularity of AI PCs, the PC industry in 2024 is destined to be inseparable from Qualcomm's re-entry.

The Qualcomm X Elite is not Qualcomm's first PC chip, but undoubtedly, it is the most anticipated Qualcomm PC chip, having built up high expectations since its announcement in October last year. Specifically, the two biggest highlights of the Qualcomm X Elite are undoubtedly its lower power consumption at the same performance and its NPU with up to 45 TOPS of computing power.

In the era of AI PCs, the importance of NPU computing power is too high.

At an AI summit held by Intel in March, Todd Lewellen, Vice President of Intel's Client Computing Group, mentioned that Microsoft insists on running Copilot Runtime on the NPU rather than the GPU to minimize the impact on battery life:

We had many discussions with (Microsoft) last year, and we asked, "Why can't we run it on the GPU?" They said they wanted to ensure that the GPU and CPU were freed up to complete other tasks. And we want to ensure an excellent battery life experience. If you run Copilot and some of these workloads on the GPU, you'll see a significant impact on battery life.

Figure/ Microsoft

To a certain extent, Microsoft pointed out the common problem with so-called "AI PCs" in the first half of the year: Heterogeneous computing affects other software and daily operations on PCs by calling on CPU and GPU computing resources, and can even make the entire system experience lag.

Furthermore, constrained by the slow speed of CPUs and high power consumption of GPUs in AI acceleration calculations, heterogeneous computing still has efficiency issues, which is obviously not suitable for laptops with extreme battery life requirements.

In contrast, the NPU, as a processor specifically designed for neural network operations, has higher efficiency and lower power consumption in AI operations, making it more suitable for running AI daily. So after the Qualcomm X Elite, from Intel to AMD to Apple, they are all significantly boosting NPU performance:

- Apple released the M4 chip in May, with NPU computing power reaching 38 TOPS, more than doubling the 18 TOPS on the M3;

- AMD released the Ryzen AI 300 series APU in June, equipped with the "strongest mobile NPU," with computing power reaching 50 TOPS, and AI PCs equipped with this chip will be launched in July;

- Intel also showcased Lunar Lake, with NPU computing power reaching 48 TOPS, scheduled for shipment in the fall.

Figure/ AMD

Moreover, this is not the end of this round of PC chip upheaval. According to media reports, after Qualcomm, MediaTek will join forces with NVIDIA to launch Arm-based PC chips in 2025, and AMD is also planning to launch Arm-based PC chips:

This is likely to change the entire PC market.

Closing Thoughts

Looking at the development of the PC market over the past six months, AI technology has undoubtedly become an important force driving the industry forward. From Intel to AMD to Apple, chip vendors have invested significant resources in enhancing NPU performance to meet the demands of AI computing. Although heterogeneous computing still faces challenges in efficiency and power consumption, we can see that the industry is rapidly adapting and optimizing.

Looking ahead, the PC market will become more diverse and intelligent. With the cooperation between MediaTek and NVIDIA and AMD's planned launch of Arm-based PC chips, the traditional x86 architecture may be impacted, and the PC ecosystem will usher in more innovations and changes.

For consumers, future PCs will be more than just computing tools; they will be intelligent assistants and efficient partners. This not only changes the way we work but also profoundly affects our lifestyles. In this transformation, only vendors that continuously innovate and focus on user experience will stand out and become leaders in the new wave of technology.

The first half of 2024 saw turbulent changes in the tech industry.

Large models accelerated their rollout, with AI phones, AI PCs, AI home appliances, AI search, AI e-commerce, and other AI applications emerging in endless streams;

The Vision Pro went on sale and landed in the Chinese market, reigniting the wave of XR spatial computing;

HarmonyOS NEXT was officially released, changing the mobile OS ecosystem;

The automobile industry has fully entered the "second half," with intelligence becoming a top priority;

E-commerce competition has become increasingly fierce, with low prices and even better services;

The wave of going global has risen, with Chinese brands embarking on a global journey;

...

As the July heatwave arrives, LeiTech's Mid-Year Review series goes online, summarizing the brands, technologies, and products worthy of note in the tech industry in the first half of 2024, recording the past, and looking forward to the future. Please stay tuned.

Source: LeiTech