That’s why they have the “Copilot PC” hardware requirement, because they’re using an NPU on the local machine.

searches

https://learn.microsoft.com/en-us/windows/ai/npu-devices/

Copilot+ PCs are a new class of Windows 11 hardware powered by a high-performance Neural Processing Unit (NPU) — a specialized computer chip for AI-intensive processes like real-time translations and image generation—that can perform more than 40 trillion operations per second (TOPS).

It’s not…terribly beefy. Like, I have a Framework Desktop with an APU and 128GB of memory that schlorps down 120W or something, substantially outdoes what you’re going to do on a laptop. And that in turn is weaker computationally than something like the big Nvidia hardware going into datacenters.

But it is doing local computation.