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While worldwide PC processor unit shipments are up, uncertain OEMs (original equipment makers) who are reactive to any potential slackening in demand are cutting orders and this is affecting the entire supply chain.
According to IDC, worldwide PC microprocessor unit shipments and revenues in the third calendar quarter of 2010 increased 2.1pc and 2.5pc, respectively, compared with the second quarter.
Compared to the third quarter of 2009, worldwide PC microprocessor unit shipments and revenues in the third calendar quarter of 2010 (3Q10) increased 8.6pc and 24.1pc, respectively.
The average sequential change in unit shipments between a calendar year's second quarter and its third quarter is an increase of 10.6pc. For revenues, the average sequential change is an increase of 9.0pc. So, these increases represent lower performance than usual for a third calendar quarter.
“Market demand for processors was weak in July and in August,” said Shane Rau, director of Semiconductors: Personal Computing research at IDC.
“OEMs have become very reactive to any hint of slackening end demand. And, when they cut their PC build orders, like they did in late Q2 and the first half of Q3, not only did they cut their processor orders, they caused their contract manufacturers to cut orders for commodity components. The whole supply chain is skittish."
Comparing market performance in the third quarter against the second quarter by PC form factor, mobile PC processor unit shipments rose 1.6pc in 3Q10, PC server processors rose 4.1pc, and desktop PC processors rose 2.4pc.
Comparing Q3 2010 against Q3 2009 by PC form factor, mobile PC processor unit shipments rose 13.3pc in 3Q10, PC server processors rose 24.4pc, and desktop PC processors rose 1.7pc.
For the overall worldwide PC microprocessor market in 3Q10, Intel earned 80.4pc unit market share, a loss of 0.3pc, while AMD earned 19.2pc, a gain of 0.2pc, and VIA Technologies earned 0.4pc, a gain of 0.1pc.
In 3Q10 unit share by form factor, Intel earned 85.9pc share in the mobile PC processor segment, a loss of 0.2pc. AMD finished the quarter with 13.7pc (unchanged) and VIA earned 0.4pc, a gain of 0.2pc.
In the PC server/workstation processor segment, Intel finished with 93.7pc market share, a gain of 0.2pc and AMD earned 6.3pc, a loss of 0.2pc. In the desktop PC processor segment, Intel earned 71.8pc, a loss of 0.4pc; AMD earned 27.8pc, a gain of 0.5pc, and VIA earned 0.4pc.
“We believe that the fourth quarter of 2010 will be a decent quarter," added Rau. “We reiterate that the second half of the year will be seasonal given the early build for Intel's Sandy Bridge and AMD's Fusion architecture launches.
“However, year-over-year growth in the second half will be lower than that seen in the first half of the year.
“For 2011, we believe that, even though the consumer segment will remain stalled in developed regions, IT executives will see PC upgrades as a priority over the next 12 months, which should result in double-digit growth in PC systems and PC processors units next year,” Rau said.