Microsoft ended mainstream Windows 10 support a year ago, but PC upgrades to Windows 11 have ground to a halt, analysts said.
Relief may not come until 2028 or even 2029, as high CPU prices, which analysts call “chipflation,” and high memory prices, widely known as the “RAMpocalypse” or “RAMageddon,” keep PC prices up.
PC prices were already high, and recent steps like Intel raising CPU prices are increasing the base cost of PCs, said Dean McCarron, principal analyst at Mercury Research.
“When prices are higher, demand goes down. It causes a deferred upgrade cycle,” McCarron said.
Microsoft’s Windows revenue from PC makers fell 27% in its latest quarter, missing expectations, the company’s chief financial officer Amy Hood said on the company’s earnings call last week.
Last year’s rush to upgrade from Windows 10 boosted PC demand, but sales have since slowed, Hood said. PC makers, which pay Microsoft for a Windows license on each PC sold, are also still sitting on unsold stock, Hood said.
StatCounter numbers also show a steady number of PC users hanging on to Windows 10 throughout most of 2026. In September, Windows 10 was still running on 27.7% of Windows PCs worldwide, slightly up from 26.45% in February. That coincided with the PC market crash due to high RAM prices, uncertainty around tariffs, and the Iran war.
Windows 11’s share of Windows PCs jumped from about half in October 2025 to 72.57% in February after mainstream Windows 10 support ended, then dipped to 71.5% in September. (Windows 10 extended security updates are available for both businesses — for a hefty fee — and consumers.)
For enterprises, upgrades are more complicated than making decisions based on price alone, said Neil Shah, vice president of research at Counterpoint Research. Companies in a Windows 10 end-of-support replacement cycle face a conundrum: whether to invest in expensive AI PCs, Shah said.
“All these trends are deflating the demand slowing down the replacement cycle,” Shah said.
Buyers are being prudent about what to buy and when, waiting for better deals and lower prices, which won’t happen anytime soon, Shah said.
A rush to buy PCs ahead of memory-driven price increases boosted PC shipments by 3.2% in the first quarter of 2026, according to Counterpoint. But PC shipments declined 4% in the second quarter and 21% in the third quarter.
Commercial PC replacements and Windows migrations provided some stability to the market, but “was insufficient to offset the broader market contraction,” Shah said. “We…expect a 27% YoY decline in Q4 2026, highlighting the tough market.”
Analysts were split on when PC prices will stabilize, but they agreed it won’t be 2027. Memory prices will remain inflated as long as most of the supply is directed to data centers feeding the AI boom, Mercury’s McCarron said.
Intel in its recent earnings call telegraphed that its PC chip business will remain soft through the rest of 2026 and into 2027. Its lowest-cost PC chip, Wildcat Lake, is sold out.
Supply constraints for memory and PC parts may last through 2029, said Steven Dickens, principal analyst at Hyperframe Research.
“PC vendors are combating this through restricted configurations and bundles,” Dickens said.
AI isn’t yet driving PC upgrades, which are mostly following a typical cycle, Dickens said. But high-end machines capable of running LLMs on-device are starting to shift the market.
“We are seeing power user devices for local LLM deployment becoming a material part of the mix and changing the unit price average as a result,” Dickens said.
At some point, enterprises will have to upgrade PCs, and the market will also turn around, McCarron said. If a soft PC market goes on for too long, “it will turn into a larger boom perhaps a year later,” McCarron said.
“It’ll result in a larger PC upgrade cycle down the road,” McCarron said. “It’s like compressing a spring. The longer you hold it down, the harder it snaps back.”
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