Lenovo, the world’s largest PC maker, has suffered through multiple years of slumping demand for its machines. Like many tech companies today, it is now looking to artificial intelligence (AI) for respite. According to recent reports and comments from Lenovo executives, the company is working on an “AI PC” that could be revolutionary for the computing world.
Meanwhile, Lenovo’s server business is booming thanks to demand for AI hardware. The company is already lining up orders into 2024 as faster and more powerful systems are needed to handle the complex demands of large language models (LLMs) and generative AI applications.
For the most part, PC innovation has been rather stagnant over the past several years. After a surge in orders from consumers stuck at home during the COVID-19 pandemic, interest in laptops and desktops has plummeted.
Lenovo saw its Q2 2023 revenue drop by 24% to $12.89 billion year-over-year. Its struggling intelligent device group (IDG) segment, which produces laptops, tablets, and smartphones and accounts for three-quarters of the company’s revenue, saw its income fall by 28% in Q2. Meanwhile, research firm IDC notes that global PC shipments during the quarter also fell by 13.5%, marking six consecutive quarters of decline.
Moving forward, Lenovo is counting on its upcoming AI PC to revolutionize the market. Details on the device are slim. But executive vice president and IDG president Luca Rossi said in a recent statement the machine will be “more sophisticated” and capable of handling “certain AI workloads at the edge.” He also claims it will feature enhanced “security, privacy, and improvement in battery life.”
As AI makes its way into every facet of technology and daily living, applications for the technology at the edge will become more abundant. Most of today’s computers simply aren’t equipped with enough power to handle these tasks.
As such, Rossi claims Lenovo’s upcoming device will cause an “inflection point for the PC industry” and predicts “a significant replacement cycle at the end of 2024 and in 2025.”
This is a bold claim, especially when potential buyers know almost nothing about the company’s AI PC. But CEO Yang Yuanqing is also on board, echoing Rossi’s stance. Of course, whether or not companies and consumers are driven to upgrade their devices by the new machine remains to be seen. It will take a very impressive PC and exciting new features to spark demand in the slumping market. At the same time, PC buyers are itching for something fresh, and integrated AI features could be just the push they need to upgrade.
It’s unclear when consumers can expect Lenovo’s anticipated AI PC to hit the market. So in the meantime, the company is focused on its server division and capitalizing on the growth of AI in that realm.
Lenovo recently announced two new AI server products, which have both seen strong demand since their launch. The Lenovo WA7780 G3 AI Large Model Training Server and the Lenovo WA5480 G3 AI Training and Push Server are equipped with Nvidia’s eight-card NVlink GPUs. This gives them intense computing power, which is essential for AI training and development. With AI servers in short supply around the world, Lenovo is working to meet an influx of orders.
Notably, Lenovo has also set aside $1 billion to invest in AI innovation over the next three years. As the technology is on the precipice of a historic boom, now is the time to do so. It will be interesting to see how AI technology intersects with PCs in the coming years and how Lenovo plans to capitalize. With no end in sight to the struggles of its traditional PC business, AI will surely play a pivotal role in Lenovo’s future.