Technology titan Intel (INTC 6.07%) has encountered various hurdles in its PC CPU sector over the last year. One major obstacle has been the sluggish recovery in PC demand following a post-pandemic downturn. In 2024, global PC shipments only saw a minimal increase of 1%, as reported by IDC.

While overall PC demand is largely influenced by external factors, Intel has also made its share of missteps. For instance, the company’s previous Raptor Lake CPU generation was plagued by known stability problems, prompting Intel to extend warranties in an effort to maintain its reputation. Furthermore, the desktop version of Arrow Lake, which succeeded Raptor Lake, struggled with gaming performance and garnered mixed feedback. Competitor AMD has cited the unsatisfactory launch of Arrow Lake as a key factor driving demand for its own processors.

On a more positive note, Intel’s laptop CPU lineup has thrived. The Lunar Lake series, a unique collection of low-power laptop CPUs featuring integrated memory, delivered outstanding battery performance, coinciding with Qualcomm‘s introduction of its Arm-based chips. While Lunar Lake may not be the top performer in sheer specifications, it excels in powering ultra-slim laptops with impressive battery life.

A notable success in the laptop arena

In light of the mediocre reception of Arrow Lake in the desktop CPU market, expectations weren’t high for its laptop variant. However, Intel has surprisingly exceeded expectations. Reviews for the Core Ultra 9 285H, the laptop version of the flagship Arrow Lake chip, have been significantly more favorable, with the only drawback noted being its lackluster AI capabilities.

Critics at XDA hailed the new laptop processor as “Arrow Lake’s redemption arc.” Regardless of charging status, laptops equipped with the 285H outperformed AMD’s equivalent in both single-threaded and multi-threaded tasks. Additionally, Intel’s chip excelled in gaming benchmarks due to its robust integrated graphics. Impressive battery life further highlights the progress Intel has made in efficiency.

However, the Arrow Lake series does have limitations when it comes to AI performance. Intel has integrated a less powerful AI processor, which falls short compared to the latest offerings from AMD and Qualcomm. Yet, it’s essential to note that many users may not prioritize this aspect. Critiques have deemed features requiring more AI power—reserved for Copilot+ branded PCs—as “a bad joke,” according to Tom’s Hardware. While on-device AI will evolve and improve, the current generation of AI-enabled laptops lacks significant capability.

Regaining market presence

Intel’s client computing division suffered a 9% revenue drop in the fourth quarter of 2024, culminating in just a 4% increase over the entire year. The company has experienced a decline in market share compared to AMD, a trend likely to continue in the desktop segment.

Conversely, Intel appears poised to reclaim some lost ground in the laptop CPU market. Arrow Lake represents a much-needed product for the company. The 285H is both rapid and efficient, performing impressively in gaming compared to its desktop counterpart. While AI capabilities take a backseat for now, this is not likely to be a significant concern for most consumers.

Intel intends to follow up with Panther Lake later this year, targeting exclusively the laptop CPU market. This upcoming series is expected to leverage Intel’s forthcoming 18A manufacturing process. If Intel can launch Panther Lake within a year of bringing Arrow Lake to market, it stands to strengthen its lead in the laptop CPU landscape.

While Intel’s standing in the desktop CPU segment may remain stable until the anticipated 2026 release of Nova Lake, in the laptop category, the company is clearly regaining its competitive edge.