Intel Gains Chip Market Share Due to Sandy Bridge: IHS iSuppli

Strong sales of Intel's Sandy Bridge processors helped it gain market share in the global chip space, according to IHS iSuppli, which also said AMD's Fusion strategy is seeing positive results.

Intel, buoyed by solid PC demand among corporations and strong sales of chips based on its Sandy Bridge architecture, grew its already substantial lead in the global processor market to 81.8 percent, according to market research firm IHS iSuppli.

In a Sept. 28 report, IHS iSuppli analysts said Intel grew its market share by 1.1 percentage points, while Advanced Micro Devices saw its share fall by the same amount, to 10.4 percent. However, the analysts said that both Intel and AMD are seeing positive results due to their respective architectures that they launched at the beginning of the year-Sandy Bridge for Intel and Fusion for AMD.

Executives for both Intel and AMD have said that the ramps of their newest chips have been among the fastest in their companies' histories. In July, Intel President and CEO Paul Otellini said that this year, two-thirds of the chips the company will sell will be based on Sandy Bridge. Days later, AMD CFO Thomas Seifert, who was interim CEO at the time, said the company had sold 3 million Brazos Fusion chips-for lightweight notebooks and netbooks-in the first quarter, and another 6 million in the second. The ramp for AMD's "Llano" A-Series Fusion accelerated processing units (APUs) for mainstream systems was expected to be faster.

"The success of the APUs demonstrate that we have the right strategy," Seifert said in July.

Both the Sandy Bridge and Fusion architectures offer high-level graphics and CPUs integrated onto the same piece of silicon.

"Intel in the second quarter benefited from the combination of a recovery in PC demand and strong shipment growth for its new Sandy Bridge line of microprocessors," Matthew Wilkins, principal analyst for compute platforms research at IHS iSuppli, said in a statement. "Strong corporate PC sales were particularly beneficial to Intel, as the enterprise computing segment has been outperforming the consumer market."

Overall, the PC market has seen a slowdown in sales, enough to make analyst firms like IDC and Gartner reduce their projections for this year and 2012. In addition, IDC analysts in August also reduced their overall processor shipment forecasts due to slowing PC sales and economic issues. It's been consumer sales that have been particularly slow-dragged down by such issues as the rise in the popularity of tablets and concerns about the global economy-while commercial sales have continued to be strong.

The analysts said corporate IT departments are driving PC sales as they look to refresh their systems. This helped Intel, which gets a significant portion of its chip revenues from the commercial market, according to IHS iSuppli.

Overall, IHS iSuppli's report found that while the worldwide PC market struggled in the first quarter, it returned to growth in the second quarter, with shipments hitting 85.6 million units, a jump of 3.7 percent from the same three months in 2010. That growth in PC sales fueled a 10 percent increase in global processor revenue during that time span, with revenue reaching $10.8 billion, up from $9.8 billion in last year's second quarter.

Intel also has been helped by the decision to increase production of its Sandy Bridge chips, the analyst firm said.

AMD's Fusion APUs helped the company stop the string of three quarters of sequential shipment decreases, according to IHS iSuppli.

"AMD's results were powered up by Fusion microprocessors, which delivers improved computational performance. It also provides PCs with DirectX 11 graphics capability without the need for a discrete graphics card," Wilkins said.