Intel's "Sandy Bridge" chips may not be ramping up notebook PC sales as much as expected, an FBR analyst says. Intel's chipset design flaw may be to blame, which could help AMD in the short term.
Intel's "Sandy Bridge"
processors may not be exciting the PC user base as much as the chip maker may
have expected, according to one analyst.
a March 31 report, FBR Capital Markets
analyst Craig Berger said that after checking with the top six notebooks
ODMs (original design manufacturers), overall builds of PCs in the first
quarter were lower than anticipated, and that similar results could happen in
the second quarter. Intel's release
of its 2nd-Generation Core chips
-first introduced at the 2011
Consumer Electronics Show in January-has not kicked up notebook demand as much
as expected, despite such features on the new chips as the CPU and graphics
being on the same piece of silicon.
notebook demand could improve, and builds could get ratcheted up by June, our
contacts suggest Intel's Sandy Bridge
products are not stimulating as much end demand as expected, likely impacting AMD,
too," Berger wrote.
and Advanced Micro Devices both unveiled processors with integrated CPUs and
discrete-level GPUs (graphics processing units) on the same die around the same
time, a move designed to improve such functions as high-definition video, 3D
rendering and gaming on systems. It also will improve space and cost savings
and improve the energy consumption of the systems, enabling PC makers to build
thinner, lighter and more power-efficient PCs and notebooks.
type of architecture will resonate with PC makers and end users, according to a
March 16 report by market research firm IHS iSuppli. In the report, the
analysts said GEMs (graphics-enabled
) will appear in half of the expected 230 million notebooks
sold this year, and in 45 percent of the desktop PCs. Those numbers will rise
to about 83 percent of notebooks and 76 percent of desktops shipped in 2014.
today are serving up ever-richer multimedia experiences, so the graphics
capabilities of PCs have become more important, driving the rising penetration
of GEMs," Peter Lin, principal analyst for compute platforms at IHS iSuppli,
said in a statement at the time.
President and CEO Paul Otellini has
predicted that the 32-nanometer Sandy Bridge platform will account for a third
of the company's 2011 revenue and will generate more than $125 billion in revenue
for the PC sector. However, the Sandy Bridge chips have yet to catch on the way
many analysts expected, according to FBR's
Berger said. Industry observers have debated since Apple released its iPad last
year whether burgeoning tablet sales would eat into the notebook market.
said, what probably is hurting Intel-and helping rival AMD-is
the situation with the design flaw chipset that Intel encountered in its
6-Series chipset, dubbed "Cougar Point." Announced Jan. 31, the flaw
affected four of six SATA (Serial ATA) ports in the chipset, which over time
could cause problems in the performance of such PC peripherals as the SATA
hard-disk drive or optical drive. Intel executives had estimated that the
problem would affect 5 to 15 percent of the chipsets made, but stressed that
the issue was with the chipset and not the Sandy
eventually started reshipping the Cougar Point chipsets for systems that would
not be impacted by the design flaw, and has since corrected the problem. AMD
officials said they expected
from Intel's problem, but Berger said that any bump could be
short-lived. He expects AMD's first-quarter
revenues to hit or exceed the high point
of expectations, but it may not carry over into the second quarter.
if AMD does achieve the high end of revenue
guidance, or potentially better, the upside is likely short term in nature and
due to customers turning to AMD for product
when Intel's Sandy Bridge was less available due to the chipset bug recall,"
Berger said in the note. "For 2Q, we think AMD's
revenues will fall [quarter over quarter] given its 14th week in 1Q, Intel
chipset goodness unwinding, and sluggish desktop builds, still rather