Historic price hikes for PCs are likely to linger for a long time, prompting many enterprises to put hardware upgrades on hold, analysts said.
PC prices — for both enterprise and consumer buyers — are expected to jump by about 17% this year, Gartner analyst Ranjit Atwal told Computerworld. And the era of the $500 PC for consumers will completely disappear in the coming years, Gartner said in a research study last week.
The substantial cost increases are due to price rises for memory chips, which are critical for AI applications. Memory manufacturing capacity is now being diverted to higher-margin chips used in AI servers, creating a shortage of lower-cost smartphone and PC chips.
The higher memory and component prices are expected to slow upgrades as PCs get more expensive and businesses hold on to older hardware longer, Atwal said.
Companies looking to upgrade to AI PCs could wait until prices come down, Atwal said. But with prices likely stay to high, enterprises might have to buy computers with less robust configurations.
“AI PCs were expected to come down in price, but now will increase in price in 2026, slowing adoption,” Atwal said.
Many new processors for AI PCs are already on the horizon. Intel in January released its upcoming PC chip called Panther Lake, and AMD unveiled new AI PC chips under the Ryzen banner. HP and Dell in March plan to share more details about laptops with the new chips.
But even PC makers are struggling to keep laptop prices in check. Memory prices “are roughly doubling versus the prior quarter,” Karen Parkhill, chief financial officer at HP, said during an earnings call last week.
Memory now accounts for 35% of the cost of making PCs, double the historic norm, Parkhill said. “Last quarter, memory and storage costs made up roughly 15% to 18% of our PC bill of materials,” she said, noting the comparative costs.
This year, analysts had predicted AI applications on PCs would grow as security-aware companies considered cutting cloud costs. But AI tools don’t work well on PCs with poor memory capacity. As a result, AI PCs will now fall from a necessity into a “nice to have” category, said Jack Gold, principal analyst at J. Gold Associates.
“For modern machines, reducing the amount of memory installed isn’t really an option, as performance will take a big hit — especially for AI,” Gold said.
Enterprises will extend upgrade cycles, buying fewer machines and keeping the ones they already have longer, in the hope prices will normalize. But this upgrade cycle is different, and PC prices won’t come down.
“The memory issue is going to be a long-term problem,” Gold said.
Enterprises usually negotiate with vendors on their large buys, but vendors can only absorb a limited amount of cost in terms of margins. “Yes, it will slow upgrades as PCs get more expensive and businesses hold on to PCs for longer,” Atwal said.
With price increases here to stay, the question now is how long it will take for enterprises to raise PC budgets.
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