Desktops lead PC chip slowdown

4 Jun 2008

The shipment of semiconductors for PCs and servers slowed to a growth rate of -9.2pc over first the first quarter of 2008, compared to the fourth quarter of last year due to economic concerns in the US.

Year over year, unit shipments grew by 25.7pc while market revenue grew by 15.9pc, according to IDC.

Shipments of processors for desktop PCs led the slowdown in the quarter, with sequential growth of -11.9pc. Processors designed for mobile PCs and servers faired slightly better, with growth of -5.9pc and -6.0pc respectively, compared to the fourth quarter.

All three segments experienced solid year-over-year growth, however, led by a 42.8pc increase in microprocessor shipments for mobile PCs.

“Total worldwide market shipments tend to decline from fourth quarter to first quarter because of seasonal demand patterns,” said Shane Rau, director of Semiconductors – Personal Computing research at IDC.

“However, the sequential decline in unit shipments from the fourth quarter to the first quarter was more than the -6pc to 7pc decline we typically see. As we indicated in our outlook last quarter, economic concerns in the US and the effects on corporate and consumer systems purchases meant a stronger sequential decline in Q108,” added Rau.

Since processor average selling prices increased less than 2pc quarter-over-quarter, overall market revenue fell -7.5pc, which is slightly more than the typical sequential decline.

In terms of processor vendor shares, Intel experienced a small gain over AMD in the first quarter. On an overall unit basis, Intel earned 78.9pc market share, a gain of 2.2pc. AMD earned 20.9pc market share, a loss of 2.2pc.

Similar shifts in market share were evident by form factor. In the mobile processor segment, Intel earned 85.3pc market share, a gain of 3.4pc, and AMD captured 14.5pc, a loss of 3.3pc.

In the PC server processor segment, Intel earned 87pc share, a gain of 1.6pc, while AMD earned 13.0pc, a loss of 1.6pc share. Finally, in the desktop PC processor segment, Intel captured 73.1pc share, an increase of 1pc, and AMD earned 26.7pc share, a loss of 1.0pc.

IDC’s outlook for the second quarter is for another sequential decline of approximately 5pc.

“Processor shipments in the second quarter of a year are typically at their lowest point for the whole year,” noted Rau. “This year, IDC’s outlook is slightly more conservative than in past years as economic concerns and consumer and corporate confidence remain issues.”

By John Kennedy