PC CPU shipments show mediocre quarter growth

Figures for worldwide PC microprocessor shipments and revenues have shown a slight sequential increase in the third quarter of this year of 2.1 percent and 2.5 percent respectively. Intel continues to dominate.

According to the International Data Corporation (IDC), the figures still represent a significant increase from the same period last year, with shipments and revenues rising 8.6 percent and 24.1 percent respectively.

However, with the average sequential change between the second quarter and third quarter for shipments amounting to 10.6 percent, and nine percent for revenues, it means that both have underperformed.

According to Shane Rau, director of Semiconductors: Personal Computing research at IDC the reason for this lies in lack of demand during the summer period.

“Market demand for processors was weak in July and in August. 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 2Q10 and the first half of 3Q10, not only did they cut their processor orders, they caused their contract manufacturers to cut orders for commodity components,” said Rau. “The whole supply chain is skittish.”

By comparing market performance in terms of form factor, IDC highlighted that mobile PC processor unit shipments rose 1.6 per cent from Q2 2010 to Q3 2010, while PC server processors rose 4.1 percent over the same period and desktop PC processors rose 2.4 percent. 

A year-on-year comparison shows mobile PC processor unit shipments rose 13.3 percent, server processors rose 24.4 percent, while desktop PC processors rose 1.7 percent.

The IDC report shows that that Intel managed to maintain its dominance in the market, though it slipped 0.3 percent to 80.4 percent. 

Rival AMD earned 19.2 percent at a gain of  0.2 percent, while VIA Technologies also saw a small improvement rising 0.1 percent to 0.4 percent.

In terms of unit share by form factor, Intel took 85.9 percent in mobile PC processor segment at a loss of 0.2 percent, while AMD remained unchanged at 13.7 percent and VIA rose 0.2 percent to 0.4 percent.

The PC processor segment saw Intel rise 0.2 percent to 93.7 percent, AMD earned 6.3 percent at a loss of 0.2 percent.  The desktop PC processor segment saw Intel slipping 0.4 percent to 71.8 percent, while AMD rose 0.5 percent to 27.8 percent, VIA saw no change at 0.4 percent.

While the market has seen lower than average increases in the third quarter for both revenue and shipping, Rau believes that Intel’s forthcoming release of Sandy Bridge and AMD’s Fusion architecture will see an improvement.

“We believe that the fourth quarter of 2010 will be a decent quarter. And 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,” said Rau.

“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.”