Analyst: Intel, AMD still battling in MPUs, but others hurting more

September 11, 2007 – AMD did a better job than expected of gaining microprocessor market share on Intel in 2Q07, but from a wider perspective, the story is less about the two market giants and more about the smaller suppliers squashed in their “elephant dance,” according to new analysis from iSuppli Corp.

AMD accounted for 13.4% of total MPU sales in 2Q, vs. 10.9% in 1Q and 16.4% a year ago, iSuppli noted. The firm defines the MPU segment as RISC and general-purpose devices, as well as X86-type chips for PCs. Intel, meanwhile, dropped a couple of points to 78.8% share in 2Q, vs. 80.8% in 1Q, though still well above the 73.4% seen in 2Q06.

Both AMD’s bump and Intel’s slide in 2Q exceeded iSuppli’s expectations. For AMD, the gains were “impressive and much needed,” putting a stop to three straight quarters of marketshare gains by Intel, noted Matthew Wilkins, iSuppli principal analyst for compute platforms research, in a statement. He credited increased shipments for notebook, desktop, and server microprocessors.

A decline in overall microprocessor average selling prices (ASP) actually hurt Intel more, particularly in the lower-end desktop and notebook PC segments. Unit shipments for notebook PCs are slated to grow 26% this year, and PC OEMs and semiconductor suppliers want to keep prices down to maintain this level of demand, he noted.

Beneath the top two rivals, the MPU market is a tough business to be in. Wilkins pointed out that while Intel and AMD have been fighting each other, they’ve actually taken 2.3 percentage points of marketshare from the rest of the MPU suppliers in the past 12 months — despite the fact that the rankings are revenue-based and reflect “huge pricing pressures” aimed at the top two firms, he noted.

“As the old saying goes: ‘When elephants dance, the grass suffers,'” he quipped.


2Q07 Global microprocessor market share
(% of global revenue)

Company……………2Q07 market share……….vs. 1Q07 (% change)……….vs. 2Q06 (% change)

Intel………………………….78.8%…………………………80.8% (-2.1%)……………73.4% (5.4%)
AMD…………………………13.4%………………………….10.9% (2.5%)……………16.4% (-3.1%)
Others……………………….7.8%……………………………8.3% (-0.4%)……………10.2% (-2.3%)

Source: iSuppli

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