Skip Navigation

Business

Microprocessor sales go ‘Atomic’ due to demand for mobile PCs

Microprocessor sales go ‘Atomic’ due to demand for mobile PCs

Despite the recession, worldwide PC microprocessor shipments reached all-time record levels for a single quarter, driven mainly by demand for mobile PC microprocessors.

According to IDC, shipments of microprocessors in Q3 grew 35.7pc quarter-on-quarter and up 23pc year-on-year.

This is about double the normal growth in unit shipments for the same period. In terms of revenue, the PC processor market grew more than 14pc quarter-over-quarter to US$7.4 billion.

Growth driver

Looking at market performance by PC form factor, mobile PC processors continue to drive growth. Mobile PC processors, which include Intel's Atom processors designed for netbook PCs, increased 35.7pc in 3Q09 compared to 2Q09.

Desktop PC processors grew 11.4pc quarter-over-quarter and x86 server processors grew 12.2pc quarter-over-quarter.

“The story about Q3 leads with Atom processors being sold in netbooks manufactured and sold in China”, said Shane Rau, director of semiconductor research IDC.

"While Atom processors led the PC processor market to reach record unit shipments, on the revenue side, their low average selling price led to notable price erosion, more than 7pc.

“As a result, while market shipments rose 23.0pc compared to Q2, market revenue grew less, 14.1pc compared to Q2. Most meaningful about Q3 is that, since PC processor shipments overall just slightly exceeded shipments in 3Q08 — which was itself a record quarter at the time — we know that the processor market is recovering.”

Earnings

In 3Q09, Intel earned 81.1pc share of the worldwide PC processor market's unit shipments, a share gain of 2.2pc, while AMD earned 18.7pc, a loss of 2.0pc, and VIA Technologies earned .2pc.

In Q3 by form factor, Intel earned 88pc share in the mobile PC processor segment, a gain of 1.1pc, AMD finished with 11.9pc, a loss of 0.7pc, and VIA earned 0.2pc.

In the PC server/workstation processor segment, Intel finished with 90.4pc market share, a gain of 0.5pc and AMD earned 9.6pc, a loss of 0.5pc.

In the desktop PC processor segment, Intel earned 72.2pc, a gain of 2.0pc and AMD earned 27.4pc a loss of 1.9pc. VIA earned 0.3pc share.

Due to the market's excellent performance and signs early in the fourth quarter that demand for PCs, particularly mobile PCs, is healthy, IDC has raised its forecast for PC processor unit shipments in 2009 to well more than 300 million units and a unit growth rate of 1.5pc compared to 2008.

“Compared to where the market was at the beginning of 2009, PC processors have come back remarkably strong,” said Rau.

Despite raising its forecast for 2009, IDC is conservative about early 2010.

“While it’s clear our concerns about the second half of the year weren't necessary, we’re still watching for a ‘gotcha’, possibly in 1Q10. The market’s growth has been due to shipments of inexpensive Atom processors being sold into markets like China, which is being stimulated by government incentives there.

“The Chinese market can be very opaque — there are lots of places where inventories can hide. We have to be on the lookout for when China decides it can’t consume more processors. Meanwhile, the US market is still hamstrung by housing foreclosures and rising job losses,” Rau said.

By John Kennedy

Photo: Intel earned 81.1pc share of the worldwide PC processor market's unit shipments in the third quarter of 2009, a share gain of 2.2pc.

Categories: Business