UK — The Register
Microsoft's AI PC push meets a wall of RAM prices, but Redmond is still beating the drum
Devices1 min read
Microsoft is pushing businesses to treat new AI-ready PCs as part of their AI spending. The push comes as rising memory chip prices make many buyers put off PC upgrades.
What happened
At a big PC industry event in Barcelona, Microsoft asked resellers and distributors to back its AI PCs. Mark Linton, a senior Microsoft sales leader, said the company wants PC spending to sit inside the AI budget, not just the normal PC upgrade budget. He also said some AI work should run on the PC itself, not only in the cloud.
Key numbers
- Microsoft's Windows OEM and Devices division revenue fell 22% to $3.55 billion in the latest quarter.
- Microsoft warned that revenue may fall about 30% in the next quarter.
- IDC says PC shipments in calendar Q3 fell 20.1% to 62.7 million units.
- That drop means 15.8 million fewer PCs went into distributors' warehouses.
Why PC prices are up
AI data centers need huge amounts of memory. Memory chip makers earn more from a high-profit type of memory called HBM, so they make less of the common DRAM. That pushes up costs for all PCs, and many buyers are waiting before they upgrade.
Why it matters
Microsoft needs PC sales to grow again. Its plan is to make Windows the main place where AI tools run. But AI PCs have been hard to sell, because they cost more and few apps clearly need them. If businesses do not see a clear benefit, the PC market may stay weak.
What to watch
- Whether businesses start putting PC upgrades into their AI budgets.
- Whether memory prices fall or keep rising.
- Whether Microsoft's sales numbers recover in its next quarter.
- Whether useful apps appear that make AI PCs worth buying.
Glossary
- HBM
- A fast, high-profit type of memory chip often used in AI data centers.
- DRAM
- The common type of computer memory used in most PCs and phones.
- IDC
- A market research firm that tracks how many computers and phones are sold.