The personal computer industry has returned to growth after more than two years in the doldrums, according to the latest figures released by International Data Corp. today.

In its latest market tracker, the research firm said PC shipments hit 59.8 million units during the first quarter of the year, representing growth of 1.5% from the same period last year. With that increase, the PC market has finally returned to pre-pandemic levels, thanks to what analysts believe is the onset of a new refresh cycle spurred by the need to replace devices bought during the early days of the COVID-19 pandemic.

The PC market had hit the “lowest point in history” exactly one year earlier, when shipments dipped more than 28%.

According to IDC, total PC shipments during the first three months of 2024 more or less matched the 60.5 million units that were shipped during the first quarter of 2019. That was the year before the COVID pandemic led to a massive increase in PC and laptop sales that lasted until well into 2021. With the onset of remote work during the pandemic, millions of people rushed out to buy new hardware. However, as the pandemic ebbed and those people returned to work, demand for PCs slowed considerably, causing shipments to plunge.

A gradual recovery in PC demand that began last year has finally dragged the PC market back into growth mode, and IDC is forecasting more good times ahead for manufacturers and component makers.

That’s because the demand is being accelerated by an emerging category of so-called “AI PCs,” or next-generation computers with onboard AI processing capabilities that can enhance user’s productivity. The AI PC segment is expected to see growth of more than 50% this year, and double again in 2025, when it is forecast to account for more than 43% of the PC market. By 2027, AI PCs should account for almost 60% of all PC sales, IDC added.

In addition, the market rebound is being driven by the need of businesses to refresh many of the PCs that were bought during the early days of the pandemic. Those devices are almost four years old now, so there are good reasons to upgrade with the advances in hardware since then. It’s also likely that Microsoft’s decision to end support for Windows 10 next year will also prompt a new cycle of device replacements, if it hasn’t already.

According to IDC Research Manager Jitesh Ubrani, the recovery is expected to continue throughout 2024 as more AI PCs hit the shelves this year. “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 batch of AI PCs went on sale last year powered by Advanced Micro Devices Inc.’s new Ryzen 7040 chips, and were followed at the start of this year with another batch powered by Intel Corp.’s most advanced Core Ultra chips.

Qualcomm Inc. is set to launch a new Snapdragon X processor for PCs that should result in more AI PCs hitting the market later this year.

The difference between AI PCs and standard PCs is that the former is fitted with a neural processing unit or NPU, as well as the central processing unit and sometimes a graphics processing unit. The NPU helps PCs to process a variety of AI workloads more easily, including large language models that power generative AI chatbots and image generators.

All of the traditional PC makers, such as Dell Technologies Inc., HP Inc. and Lenovo Group Ltd., have pushed hard into the AI PC segment in recent months, while Apple Inc. has also touted the AI capabilities of its upcoming Mac computers, which will be powered by the company’s M-Series chips.

Lenovo managed to hold on to its position as the world’s No. 1 PC maker in the latest results, showing the third-fastest growth rate. The Chinese firm benefited from a 7.8% rise in shipments to achieve a 23% share of the market overall, with total shipments coming in at 13.7 million, IDC said. In second place with a 20.1% market share was HP, which shipped 12 million PCs, flat from a year ago. Dell came in third with a 15.5% share of the market, however it notably saw shipments decline 2.2%, to just 9.3 million.

Acer Group delivered the second-fastest growth with shipments growing 9.2%, to 3.7 million overall, giving it a 6.2% market share, which meant it ended up in a fifth place tie with ASUSTeK Computer Inc., which saw shipments decline 4.5%.

As for Apple, it grew faster than anyone else, with shipments rising 14.6%, to 4.8 million units, handing it fourth place with an 8.1% market share.

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