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The main takeaway is that while Arm-based PCs face some challenges, they still have a lot of potential for growth. This is mainly due to claims of better battery life compared to older models. At the same time, Intel is working hard to improve and meet new market needs.
The PC market is changing significantly as Arm-based processors become more popular, challenging the long-standing dominance of x86 architecture. However, this shift comes with its own set of challenges. Michelle Johnston Holthaus, interim co-CEO of Intel, discussed these issues at the Barclays 22nd Annual Global Technology Conference.
Johnston Holthaus mentioned that retailers are experiencing high return rates for Qualcomm-powered devices. She said, “If you check with any retailer, their biggest concern is the high percentage of Arm PCs being returned,” attributing this to compatibility issues with common applications.
Qualcomm quickly responded, stating, “Our device return rates are within industry norms,” according to a spokesperson who spoke to CRN. The spokesperson also noted that Qualcomm expects 30% to 50% of laptops to switch to non-x86 platforms within the next five years.
Despite differing opinions, Arm-based systems are making their mark in the PC market. Although Qualcomm Snapdragon X Elite machines currently have only 0.8% of the market share, the overall Arm-based PC segment holds about 10% of the market. This growth is primarily thanks to Apple’s M-series processors, which have led the way for more Arm adoption.
Intel is well aware of these changes. “We [will] have more competitors than ever before. You will see more competitors entering the market in 2025,” Johnston Holthaus noted, possibly hinting at MediaTek and Nvidia joining the Arm-based Windows PC market.
Intel has been working on enhancing its performance and power efficiency to compete with Arm-based rivals. “We took too long at Intel to focus on performance and power, and we made a huge leap with our Lunar Lake product last year,” Johnston Holthaus said.
For example, Intel introduced a hybrid architecture in its latest processors, which combines Efficient-cores (E-cores) with Performance-cores (P-cores) to balance power efficiency and high performance. This design extends beyond laptops and desktops, significantly impacting Xeon 6 datacenter CPUs, offering 3:1 rack consolidation and up to 2.6x performance-per-watt improvements over previous models.
Intel is also working with Arm to create low-power SoCs using its 18A process and has already started integrating AI hardware into its processors. The Lunar Lake architecture, for instance, includes a fourth-gen NPU capable of delivering up to 48 TOPS – a fourfold improvement over its predecessor.
Laptops featuring Qualcomm’s Snapdragon X Pro and Elite chips were the first PCs to support Microsoft’s Copilot AI features, positioning them at the forefront of the company’s AI PC initiatives. However, most AI PCs are gaining market traction through Intel and AMD’s x86 processors instead.
In the third quarter of 2024, AI PCs made up 20% of all PC shipments, a 49% increase from the previous quarter, thanks to greater availability. Despite this growth, consumer interest in AI PCs and GenAI features remains modest. Intel and AMD devices, which account for about half of these shipments, are just beginning to receive support for Copilot.
Meanwhile, Snapdragon X laptops are getting high praise mainly for their long battery life, often lasting a full day. Additionally, the upcoming end-of-life for Windows 10 is expected to boost sales significantly, as users upgrading to Windows 11 may end up adopting AI PCs, sometimes without realizing it.
