In Chips, AMDs Shipments Zip; Intels Slip

By John G. Spooner  |  Posted 2005-05-09

In Chips, AMDs Shipments Zip; Intels Slip

Chip maker AMD made market-share gains against rival Intel during the first quarter of 2005, thanks to a refreshed product line.

Advanced Micro Devices finished the quarter with a 16.9 percent share of the worlds PC processor market, as shown in figures made public by Mercury Research on Monday.

Meanwhile, AMDs chief rival, Intel Corp., cornered 81.7 percent of the market during the quarter. The remainder went to VIA Technologies and Transmeta.

The first-quarter PC processor shipment figures arent far off of historical trends.

Intel typically commands a dominant position with somewhere between about 80 percent and about 85 percent of the market.

But AMD still managed to gain ground, aided by a better-sorted value line of processors and small but steady gains with its Opteron server chip as well, said Dean McCarron, principal analyst with Mercury Research.

When comparing its first-quarter 2005 performance to the first quarter of 2004, during which it had 15 percent share, AMD shows a gain of nearly two percentage points, according to the Mercury Research figures.

Intel saw a 1.8-point decline when measuring its first quarter 2005 share of 81.7 percent against its first quarter 2004 share of 83.5 percent, the Mercury figures also show.

The two companies saw much smaller sequential market share changes.

Comparing its first quarter 2005 share to its fourth quarter of 2004 share of 82.2 percent, Intel slipped half a point.

AMD increased its share by three-tenths of a point sequentially from 16.6 percent in the fourth quarter of 2004 to its 16.9 percent share in the first quarter.

Despite its market share change, "Intel is really actually dong quite well," McCarron said. "Because [Intel] is the larger supplier, if AMD makes any significant gains, then it comes out of Intels share. Its definitely worth noting that both companies were setting new records for their unit volumes" in the quarter.

Next Page: Notebooks in demand.

Notebooks in Demand

The big story for Intels first quarter was its notebook chip business.

Demand for notebook processors, where Intel and its Centrino brand are particularly strong, benefited the chip maker during the quarter.

"Ive seen a dramatic increase in mobile [processor] unit shipments" from the chip maker, McCarron said. "From what I had seen, it was a fairly significant departure from normal trends. The numbers are indicative of a pretty fundamental change in the PC market" toward notebooks and away from desktops.

AMDs upward movement can be attributed to the companys product mix.

"When you look at what happened in 2004, the two key contributions for AMD were Athlon 64 beginning to ship in measurable volumes and the redevelopment of its value product line with Sempron," McCarron said.

Click here to read more about AMDs plans to continue to tout single-core processors for certain applications.

AMD, McCarron said, hamstrung itself for a time by using its Athlon XP chip to cover both the low-end and parts of the midrange of the PC market.

Starting in the third quarter of last year, it introduced the Sempron chip line for low-price PCs and diversified its Athlon 64 processor line with several new models, which covered a greater swath of the midrange market.

The companies rivalry is likely to heat up again in coming quarters, wherein they will compete with dual-core chips.

AMD, which recently retired its Athlon XP brand, has introduced new dual-core Athlon 64 X2 chips, which will come out in PCs in June.

Intel already has a dual-core desktop chip, the Pentium Extreme Edition 840, which is available now in PCs.

Read more here about Intels plans to focus on improving its desktop and server platforms for businesses.

It has announced plans to add numerous others as well, including a more mainstream dual-core chip, the Pentium D, which will come out next month.

Check out eWEEK.coms for the latest news in desktop and notebook computing.

Rocket Fuel