Microsoft and partners dropped prices on Copilot+PC computers, but this did not help increase sales

Microsoft and its key partners reduced prices for Copilot+PC class computers in Europe in the fourth quarter of last year, but this did not bring the expected effect. The Register writes about this with reference to its own knowledgeable source.

Image source: Microsoft

According to research company Context, the average price of Copilot+PC laptops from distributors in November decreased by about 10% compared to October. “While price cuts helped drive some interest in the fourth quarter, the value proposition of these devices still needs to be better communicated to consumers. As the concept matures, awareness increases and price ranges expand, we expect adoption rates to increase in 2025,” said Context senior analyst Marie-Christine Pygott.

This confirms last year’s forecast from Gartner, whose analysts warned that buyers could be deterred by the high prices of computers with artificial intelligence. Additionally, the lack of breakthrough AI applications is slowing demand growth.

PC sales in Europe overall showed modest growth in the run-up to Christmas, according to Context. However, sales of AI-powered PCs are still below manufacturers’ expectations. Revenue from sales of PCs, laptops and tablets in Europe grew during the last quarter. In December, PC revenue in the region increased 7% year-over-year.

According to the source, the adoption rate of AI laptops in the European market rose to 32% in the fourth quarter, up from 22% in the previous three-month period. The share of Copilot+PC computers in this segment increased from 3% to 5% over the same period. According to forecasts, by 2025, AI computers could occupy more than 40% of the market.

In Europe, the segment is developing slower than manufacturers’ expectations. At the same time, concerns remain in the US about demand for AI-powered PCs. In the future, the administration of the new US president may increase duties on products made in China. According to analysts, this could lead to an increase in the cost of laptops in the American market by 68%. This will be a major blow to Microsoft, which has been making significant efforts to promote Copilot+PC and is investing billions of dollars in the development of AI technologies.