The global laptop market is poised for a modest growth trajectory, with a projected increase of 4.9 percent in 2025. This forecast is primarily influenced by commercial upgrade cycles and the impending end of life for Windows 10, rather than a surge in demand for AI-capable devices. According to Taiwan-based market analyst TrendForce, the anticipated recovery in laptop shipments will begin to materialize towards the end of 2024, with a notable uptick expected in the following year. However, the impact of AI-integrated notebooks on the overall market remains limited at this stage.
Market Dynamics and Future Outlook
TrendForce highlights that commercial laptops encountered significant challenges throughout 2024, driven by economic and political uncertainties that fostered a cautious approach among consumers. Nevertheless, the firm predicts that annual shipments will reach 174 million units, reflecting a 3.9 percent year-on-year increase.
Looking ahead, the political landscape appears to be stabilizing post-US presidential election, and recent rate cuts by the Federal Reserve are expected to invigorate capital flow. This shift is anticipated to unleash a wave of deferred replacement demand from corporations, paving the way for a robust recovery in the commercial sector by 2025. Coupled with the end-of-service date for Windows 10 in October of next year, shipments are forecasted to rise to 183 million units.
Despite these positive indicators, recent demand has been tempered by pricing concerns and a lack of clarity surrounding the newly introduced AI PC category. As Gartner research director Ranjit Atwal noted, “Businesses want to move to AI PCs but not pay a premium as there are no compelling business cases.” Currently, AI-capable PCs command a 10-15 percent price premium over standard models, a situation that may need to evolve to encourage corporate investment.
The ambiguity surrounding AI PC definitions contributes to this hesitance. Vendors like Intel define AI PCs as systems equipped with their latest processors featuring an embedded neural processing unit (NPU) for enhanced AI task performance. In contrast, Microsoft’s CoPilot+ branding pertains to Windows systems with NPUs capable of 40 TOPS or greater. This divergence leaves businesses uncertain about which definition will provide the best future-proofing as AI algorithms increasingly integrate into daily operations.
In anticipation of a surge in demand, the IT channel is actively stocking AI-capable PCs, with reports indicating that these devices accounted for 20 percent of all shipments to distributors in Q3 2024. Meanwhile, Microsoft is intensifying efforts to transition Windows 10 users to Windows 11, utilizing full-screen advertisements that often necessitate new hardware investments.
However, a significant concern looms over the market: its close ties to US trade policies. Any potential increase in import tariffs under the Trump administration could have profound implications. China continues to dominate laptop manufacturing, contributing approximately 89 percent of total production capacity. While some companies are diversifying their production into countries like Vietnam, Thailand, India, and Mexico, establishing a fully integrated supply chain in these regions to mitigate tariff impacts will require time.
As a result, TrendForce cautions that its shipment forecasts for 2025 may undergo revisions depending on the evolving market landscape, leaving stakeholders to navigate a complex and shifting environment as the new year approaches.
