Rising component cost to keep hardware prices elevated in near term, Lenovo executive says

Shortages of key components such as memory chips are pushing up costs across the artificial intelligence computing ecosystem globally and are likely to keep hardware prices elevated in the near term, a senior executive at Chinese technology company Lenovo said.

“This is not unique to India,” Fan Ho, executive director and general manager of Services and Solutions Group at Lenovo, Asia Pacific, told ET in an interview. “There are only a handful of memory manufacturers in the world, and demand from AI workloads is rising very quickly. As a result, memory prices have gone up significantly.”

The situation is likely to keep hardware prices elevated in the near term, she said. “Based on what we are seeing, memory costs are still increasing, and supply is tight. This is something the entire industry is dealing with.”


Key growth market

India is emerging as a key growth market for Lenovo’s services and solutions business, particularly as global capability centres (GCCs) expand operations, Ho said. “We see strong demand from companies setting up or expanding GCCs here. They are not just looking for devices. They want a partner who can support them as they scale their technology infrastructure.”

Many of these companies begin with small teams but expect rapid expansion. “When GCCs come in, they may start with 10 or 50 people, but they already know they will grow much bigger,” she said. “They want a model where the devices, infrastructure and services can scale along with their operations.”

Lenovo is positioning itself as a long-term partner by combining hardware with managed services and enterprise solutions, Ho said. “Our approach is not only about selling machines,” she said. “It is about helping customers deploy technology and manage it effectively across their organisation.”

Adoption of AI PCs slow

Demand for AI PCs in India remains nascent, Ho said, citing higher cost of AI-enabled devices and the lack of compelling everyday use cases as factors slowing wider adoption.

“I would agree that the price is still on the high side,” she said. “Many users are also still exploring what the real use cases are. Once people start seeing practical benefits in their daily work, adoption will gradually increase.”

For Lenovo, the world’s largest PC manufacturer, AI PCs are only the first step in a broader technology shift, she said. The company views these devices as an entry point into a hybrid AI architecture that combines on-device computing, private enterprise infrastructure and cloud systems.

“The future will involve public AI, personal AI, and enterprise AI working together,” she said. “AI PCs are important because they bring computing power closer to the user while still connecting to larger AI systems.”

The biggest opportunity in the AI era will lie beyond hardware, she said. “The real differentiation will come from services and platforms. Enterprises want flexibility. They do not want to be locked into a single ecosystem.”

The company’s focus is to build neutral platforms that allow customers to work across different AI models and environments, she said. “That is where we believe the long-term value will be created.”