Thanks to hot server demand related to AI implementations, Dell (DELL) enjoyed an incredible post-earnings rise. The stock rose from $80-$90 to over $130 before dipping to $116.25 last Friday.
On the personal computer segment, International Data Corporation (IDC) has a bullish view. It expects global PC shipments will top 265.4 million, up a 2% Y/Y. The positive sales growth depends greatly on consumers and businesses upgrading PCs for the AI neural computing component. The astute chief information officer and its technical support department will know better.
During the pandemic, customers upgraded their laptops to work effectively at home. When the pandemic lockdown lifted, they did not need another refreshed PC.
CIOs will know that AI on PCs is mostly unnecessary. Users will access ChatGPT online most of the time. An offline AI model will require at least 50 GB of memory and plenty of storage. Increased storage demand would help Western Digital (WDC) and Seagate (STX). However, both stocks traded recently at 52-week highs. They already benefit from solid-state drive supplies at equilibrium with demand. Higher SSD prices will expand profit margins at current trajectories.
PCs running AI models still need graphics chip processing power. Nvidia (NVDA) and AMD (AMD) curtailed their efforts to release the fastest GPUs. Games achieve higher FPS or frames per second by relying on a powerful GPU.
Unless GPUs advance at lower prices for the PC market, higher sales in 2024 are unlikely.
