AMD Bumps Up Third-Quarter Market Share

AMD gained nearly two points of market share during the third quarter, while Intel's share shrank, reversing a trend that cut the opposite way during the second quarter.

Advanced Micro Devices Inc. gained a bigger piece of the pie in the third quarter.

The Sunnyvale, Calif., chip maker, which is Intel Corp.s primary rival in x86 processors—the type of processor most PCs and many computer servers are based on—gained 1.6 points of market share during the quarter, a report by Mercury Research Inc. of Cave Creek, Ariz., shows.

AMD, as previously reported, advanced to 17.8 percent of shipments, up from 16.2 in the second quarter and 15.9 percent in the same quarter a year ago.

Chip giant Intel Corp., however, ended the quarter with a smaller 80.8 percent of shipments, down from 82.3 percent in the second quarter and 82.1 percent in the third quarter of 2004, the Mercury Research figures show.

"AMD gained share in every major market sub segment, whether its desktop, notebook or server," said Dean McCarron, principal analyst at Mercury Research. "A lot of that comes down to having some more competitive product offering than theyve had in the past."

Indeed, AMD has stepped up its efforts to penetrate notebooks and servers, which are traditional Intel strongholds, with new products.

AMD has begun offering dual-core versions of its Opteron processors, which beat Intels dual-core Xeons to market by several months, since April. AMD has also rolled out a new notebook chip, dubbed Turion.

AMD also gained share in servers in the third quarter, the company said, capturing 12.7 percent of x86 server processor shipments, an AMD spokesperson said, versus 11.2 percent of shipments in the second quarter. McCarron refused to confirm or deny those numbers, however.

/zimages/2/28571.gifClick here to read more about AMDs second-quarter advance in servers.

Thus AMDs third-quarter performance appears to have reversed a second-quarter trend that saw Intel gain share at AMDs expense, despite AMD making progress in servers.

Intel and AMD have see-sawed back and forth for years. But Intel has historically maintained about 80 percent of x86 chip shipments, proving itself a formidable competitor.

Thus, the third-quarter share data, in and of itself, might not say more about AMDs performance of late than anything, McCarron said.

"Some people will look at the server space and make some comments about Intels competitive position there," he said. "But, by and large, when you have one player with a disproportionably large market share any improvement in the competitive nature of a smaller player is going to have some impact. So I think it says a lot more about AMD than it does about Intel."

Still taking back some of the share it lost will depend at least in part on "how competitive Intels products are," McCarron added.

/zimages/2/28571.gifClick here to read more about the legal battle between AMD and Intel.

As if to answer that call, Intel has already accelerated the introduction of its next-generation of server chips. The company got started by launching its first dual-core Xeon server chips ahead of schedule, for example.

It rolled out its first dual-core Xeon DP chip in October and followed on Monday with its dual-core Xeon 7000 series, months ahead of their original early 2006 launch dates.

Intel also has new dual core processors for desktops and notebooks on the way in early 2006.

AMD will continue adding new versions of its dual core Opteron and Athlon 64 chips in 2006 as well.

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