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You are here: Home / Tech Trends / IDC: Good/Bad News for Processors
IDC: Good and Bad News for Microprocessor Shipments
IDC: Good and Bad News for Microprocessor Shipments
By Jennifer LeClaire / CRM Daily Like this on Facebook Tweet this Link thison Linkedin Link this on Google Plus
For all the talk of a down economy, worldwide PC microprocessor shipments aren't feeling the pinch just yet. In fact, shipments in the third quarter of 2008 reached record levels once again, according to new data from market-research firm International Data Corporation (IDC).

Consider the statistics: Worldwide PC processor unit shipments grew 14 percent quarter over quarter and 15.8 percent year over year. Market revenue grew 7.6 percent quarter over quarter and 4.1 percent year over year to $8.3 billion.

According to IDC, Intel's new Atom processor for ultra-low-cost mobile PCs -- which Intel calls netbooks -- made a notable difference in the overall market performance. When researchers removed Atom from the equation, unit shipments grew 8.3 percent quarter over quarter and 8.7 percent year over year.

"Not considering the effects of Atom, the overall market still grew at a decent pace in the third quarter," said Shane Rau of IDC. "Intel's and AMD's shipments grew at a rate only slightly slower than typical for a third quarter, and seasonal demand appeared reasonable up until September. By segment, while the mobile-processor segment grew aggressively, the server segment was soft."

Vendors by the Numbers

Thanks in part to Atom, Intel earned 80.8 percent market share in the third quarter, a gain of 1.1 percent. AMD finished with 18.5 percent, a loss of 1.2 percent, and VIA Technologies earned 0.6 percent.

By form factor, in the mobile-PC processor segment, Intel reigns king again. Intel grabbed an 87.4 percent share, a gain of 0.8 percent. AMD finished with 11.5 percent, a loss of 1.1 percent, and VIA earned 1.2 percent, a gain of 0.3 percent.

Finally, in the PC server/workstation processor segment, Intel finished with a market-dominating 85.6 percent share, a loss of 0.6 percent. AMD earned 14.4 percent, a gain of 0.6 percent. In the desktop PC processor segment, Intel and AMD earned 73.5 percent and 26.4 percent shares, respectively, with negligible share changes.

The overall numbers worldwide demonstrate that some markets are performing well enough to pick up the slack for slower growth in the United States and parts of Europe, according to Charles King, principal analyst at Pund-IT.

"This illustrates the wisdom of the real enthusiasm vendors have been showing for expanding their efforts overseas," King said, noting IDC's prediction that the Chinese market could expand from about 54 million PCs today to roughly 540 million by 2015.

A Murky Fourth Quarter

The question is whether the microprocessor market can sustain its gains in the short term. IDC predicted a murky outlook for the fourth quarter and all of 2009. While the market performed strong through the first three quarters of the year and should see an 18 percent gain overall, IDC said worldwide demand looks weak.

Both Intel and AMD indicated an uncertain outlook for the market. As a result, IDC is conservative about 2009 and will be lowering its unit forecast for the year.

"If the economic crisis spreads in the way that people are suggesting, then there's a real risk of that crisis impacting emerging markets as severely as it does in the West," King said. "The ripple effects of cautious U.S. consumers means Chinese companies that have been relying on the huge engine of the American consumer for years now get a knife stuck in their gut as a result -- and buying a PC may not be high on the list of many families in Asia in the coming quarters."

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