The PC industry is finally turning the corner after reporting its worst sales in 17 years in 2023. According to preliminary results by Gartner, PC shipments increased for the first time in eight straight quarters in the fourth quarter of 2023.

For the quarter, the industry shipped a total of 63.3 million units, eking out a meager 0.3% increase over the same period last year. All totaled, the industry moved 241.8 million PCs, a 14.8% overall decline, and the first time that shipments have fallen below 250 million units since 2006, Gartner said.

“The PC market has hit the bottom of its decline after significant adjustment,” Gartner analyst Mikako Kitagawa wrote in a release. “Inventory was normalized in the fourth quarter of 2023, which had been an issue plaguing the industry for two years. This subtle growth suggests that demand and supply are finally balanced.”

But Kitagawa warned that balance might be short-lived as economic and geopolitical volatility could upend the PC market’s return to growth. While the PC market picked up in Q4, the global market is still fraught with pockets of weakness. In particular China has proven to be stubbornly slow to recover.

Overall, Gartner said Greater China pulled down results for the Asia Pacific region, which saw shipments decline as much as 8%. The EMEA region saw the biggest jump in growth, with shipments rising 8.7%. North America shipments also increased.

The turnaround, however slight, comes at an important time for the PC industry, as Microsoft, chipmakers, and PC manufacturers push the concept of the AI PC as the next major growth opportunity for laptop and desktop PCs.

AI PCs are loosely defined as PCs outfitted with some kind of neural processor capable of running AI programs natively. Nvidia (NVDA) also says PCs running its graphics chips and cards are AI PCs, since AI programs run better on that kind of hardware.

Microsoft (MSFT) in particular is keen on adding AI capabilities to consumers’ devices, with the launch of its AI-powered Windows Copilot on Windows systems and the inclusion of a Copilot key on Windows laptop and desktop keyboards.

Industry watchers largely expect 2024 to serve as a kind of rebound period for the PC industry as the laptops and desktops consumers and businesses purchased at the onset of the pandemic in 2020 begin to age out of usefulness. As the world began to shut down, millions set out to purchase PCs to be able to work and play while on lockdown.

As a result, sales of PCs fell off of a cliff as consumers and businesses had little reason to upgrade in the intervening years. But as those systems begin to become outdated, demand is picking up again.

That will help a litany of companies outside of PC makers, including chip manufacturers, memory makers, and other component builders. Intel (INTC), AMD (AMD), and Nvidia should get a boost as consumers reach for new laptops and desktops, as should Microsoft, which makes billions on Windows license sales to its OEM partners.

Daniel Howley is the tech editor at Yahoo Finance. He's been covering the tech industry since 2011. You can follow him on Twitter @DanielHowley.

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