Counterpoint Research: Arm Laptops to Remain Resilient Amid Global PC Market Weakness

[AleksandarK]

The global PC market has been experiencing a demand downtrend after the cooling down of COVID-19 in 2022. The market saw its shipments decline 15% YoY in 2022 and is expected to see another high single-digit decline in 2023, according to Counterpoint Research's data. However, among all the PC sub-sectors, Arm-based laptops are expected to show a comparatively resilient demand throughout the coming quarters thanks to Apple's success with the MacBook series, increasing ecosystem support and vanishing performance gap with x86 offerings.




Apple led the market with self-designed M-series solution
Apple launched its in-house M1 chip for the MacBook series in 2020. This gradually allowed iPhone and iPad apps to seamlessly operate on MacOS with state-of-the-art power consumption management and battery life among the M1 MacBook's head-to-head competing features with the same level of computing performance. Since then, the market share of Arm-based laptops started to increase, from less than 2% to over 12% at the end of 2022, according to Counterpoint Research data. Apple dominated the Arm laptop market in 2022 with a 90% share. Apple's migration to its self-designed CPU has proved to be a shot in the arm for vendors who were sitting on the fence looking forward to developing Arm-based solutions.

Qualcomm and MediaTek likely to follow in the near term
Major global CPU providers Qualcomm and MediaTek have also expressed their interest in Arm-based solutions. As the two are experienced smartphone CPU vendors, they have worked with the Arm ecosystem for many years. Therefore, it would not be a very difficult mission for them to include Arm-based laptops/PCs in their product road maps. Although there have been some delays due to reasons like component shortages, lawsuit and product development, the two chip design giants are expected to launch Arm-based laptop solutions no later than 2024 to support incremental demand. We expect Qualcomm and MediaTek's solutions to see over 50% growth YoY on Arm laptops in 2024-2025.

Arm-based laptops to gain share at Intel and AMD's expense
However, the global PC market exited the expansion cycle in 2022 and is expected to see a shipment decline in 2023 again. Therefore, Arm's share gains will inevitably come at the expense of mainly two other major vendors in the market - Intel and AMD. Based on our forecasts, we believe Arm could ultimately take around 25% share of the laptop market by the end of 2027. On the other hand, as the largest vendor in the PC market, Intel will suffer the most, losing almost 10% share to Arm solutions in five years. But it will still dominate the PC market with over 60% share.

Above all, we believe the market share of Arm-based PCs, especially laptops, could further expand in the coming years and penetrate a variety of sub-sectors. The Chromebook boom of 2020 was just the beginning. We are forecasting an increasing penetration rate of the Arm ecosystem with chip vendors working more closely with OEMs on product offerings. The rising consumer awareness of Arm's competitiveness versus Intel's long-lasting x86 could also support market share expansion. Ultimately, we believe Arm-based laptop solutions will have a higher than 21% share by the end of 2025.

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[TheinsanegamerN]

I've yet to see an ARM based laptop....anywhere actually. Even in stores its all x86. Where is this 12% coming from?

 

[ks2]

I've yet to see an ARM based laptop....anywhere actually. Even in stores its all x86. Where is this 12% coming from?

Apple

 

[Count von Schwalbe]

I've yet to see an ARM based laptop....anywhere actually. Even in stores its all x86. Where is this 12% coming from?

... Apple dominated the Arm laptop market in 2022 with a 90% share ...

Also, I believe that some Surface models were Qualcomm (or MediaTek?) based, as are some low-end Chromebooks.

 

[Steevo]

The low end market is going to crash harder than business and premium products with the incoming recession.

 

[AnotherReader]

There's no ARM laptop market. It's only Apple.

 

[Denver]

There are several reasons why ARM-based laptops and PCs may not make sense:

Compatibility issues: ARM-based systems use a different architecture compared to traditional x86-based systems. This means that software designed for x86 systems may not work on ARM systems without modification. This could result in compatibility issues and reduced software availability, particularly for older or niche applications.

Performance: While ARM processors have come a long way in recent years, they still lag behind x86 processors in terms of raw performance. This can result in slower performance for demanding tasks such as gaming, video editing, and other resource-intensive applications.

Cost: Currently, ARM-based systems tend to be more expensive than their x86 counterparts, which may make them a less attractive option for cost-conscious consumers.

Battery life: One of the key advantages of ARM processors is their low power consumption, which leads to longer battery life. However, this benefit may not be as pronounced in laptops and PCs where the battery is a smaller component of the overall system.

Limited upgradability: ARM-based systems often have limited upgradability options, which can be a drawback for users who want to upgrade their systems over time.

Overall, while there are some benefits to using ARM-based systems, there are also several factors that may make them less attractive to consumers compared to traditional x86-based systems.

 

[AnotherReader]

There are several reasons why ARM-based laptops and PCs may not make sense:

These are all good reasons, but there's another one: lack of driver updates. Qualcomm doesn't provide driver updates for its SOCs for long compared to what we are used to in the PC world.

 

[thegnome]

If anything I see AMD market share rise more if they keep pumping out good laptop chips, more growth in there than ARM...

 

[Count von Schwalbe]

If anything I see AMD market share rise more if they keep pumping out good laptop chips, more growth in there than ARM...

I certainly hope so. Laptops are still a one-horse race in the main, and the competition is not there to keep prices normal.

 

[trsttte]

There's no ARM laptop market. It's only Apple.

Chromebooks are also laptops, and about half of them run arm.

Also, I believe that some Surface models were Qualcomm (or MediaTek?) based, as are some low-end Chromebooks.

Windows has always been Qualcomm so far. Other than the surface pro arm version, there's 1 or 2 high end models from lenovo and hp and several windows se low end devices destined for the education market.

 

[Minus Infinity]

AMD's problem is AMD. Hard to buy even Rembrandt based laptops, so unless Phoenix and Dragon Range are more readily available of course they'll lose market share whether or not there is a market slowdown.

 

[Count von Schwalbe]

AMD's problem is AMD

AMD's problem is System Integrators not offering attractive options. I can spec out an AMD DIY desktop for 600 that will cost 1200 from an OEM, but an Intel system is 800 to build and 1000 to buy. And the options are on a 10:1 ratio. I cannot believe that supply is that limited or prices are that high when AMD is cutting foundry orders and the retail components are far cheaper.

 

[Minus Infinity]

AMD's problem is System Integrators not offering attractive options. I can spec out an AMD DIY desktop for 600 that will cost 1200 from an OEM, but an Intel system is 800 to build and 1000 to buy. And the options are on a 10:1 ratio. I cannot believe that supply is that limited or prices are that high when AMD is cutting foundry orders and the retail components are far cheaper.

There have been plenty of AMD apu announcements from multiple manufacturers for this gen, so AMD is getting traction, but they have to be able to supply the apu. Last year long after Rembrandt came out, you couldn't find them readily in laptops they were advertised for.

 

[bug]

There are several reasons why ARM-based laptops and PCs may not make sense:

Compatibility issues: ARM-based systems use a different architecture compared to traditional x86-based systems. This means that software designed for x86 systems may not work on ARM systems without modification. This could result in compatibility issues and reduced software availability, particularly for older or niche applications.

Performance: While ARM processors have come a long way in recent years, they still lag behind x86 processors in terms of raw performance. This can result in slower performance for demanding tasks such as gaming, video editing, and other resource-intensive applications.

Cost: Currently, ARM-based systems tend to be more expensive than their x86 counterparts, which may make them a less attractive option for cost-conscious consumers.

Battery life: One of the key advantages of ARM processors is their low power consumption, which leads to longer battery life. However, this benefit may not be as pronounced in laptops and PCs where the battery is a smaller component of the overall system.

Limited upgradability: ARM-based systems often have limited upgradability options, which can be a drawback for users who want to upgrade their systems over time.

Overall, while there are some benefits to using ARM-based systems, there are also several factors that may make them less attractive to consumers compared to traditional x86-based systems.

It would be very easy to port everything if you were using Linux. Unfortunately, laptops come with all sorts of "custom" parts (e.g. trackpads, webcams) and that makes initial setup unappealing to the average user.

 

[Count von Schwalbe]

It would be very easy to port everything if you were using Linux. Unfortunately, laptops come with all sorts of "custom" parts (e.g. trackpads, webcams) and that makes initial setup unappealing to the average user.

Ya know, I played around with a few laptops, and the only ones that "just worked" were the Think series from Lenovo/IBM. I dual-booted for a bit (didn't even need a bootloader, just selected boot drive) and never had to install drivers for full functionality.

 

[NoneRain]

ARM is too limited right now. Only Apple is making a good job out of it, but only on applications they focus (image/video).

 

[Steevo]

AMD's problem is AMD. Hard to buy even Rembrandt based laptops, so unless Phoenix and Dragon Range are more readily available of course they'll lose market share whether or not there is a market slowdown.

Hard to buy a somewhat underwhelming performance system that needs an aggressive tune when proprietary blocks are in the way. AMD could do a lot by working more with manufacturing companies to design some basic laptops with the ability to designate a primary function and then allow aggressive tuning of all else. A thin book for book keeping, low GHz, bright screen at 1080, 16Gb of system ram and decent M2 for long battery life and no gaming with 4 cores, a mid tier all around with 6 or 8 cores and the ability to boost a couple threads to 4Ghz, 1080 and a HDMI port for presentation and video output, a high end 8 core with 32G of ram and a large fast primary storage with decent active cooling and battery life, include a DP and active DP to HDMI for those occasions where it’s needed, Bluetooth and the works.

Instead of a mid tier with passive cooling, too much slow RAM, not quite enough disk space for a 5 year life cycle and the inability to cut clocks and power and the fast boot battery drain option… use a faster larger disk.