AMD Gains Market Share, iSuppli Report Says

Advanced Micro Devices (AMD) made greater gains in the microprocessor market during the second quarter than originally predicted, according to iSuppli. The company gained 2.5 percentage points over the previous quarter to take a 13.4 percent share of the microprocessor market, which spans RISC and general-purpose devices as well as the X86-type chips for PCs sold by AMD and rival Intel Corp. Meanwhile, Intel saw a 2 percentage point decrease in revenue share, though it still commands the market with a 78.8 percent share. It was a a far cry from the predicted 0.5 percentage-point increase for Intel and the 0.5 percent increase for AMD made in July. "AMD's performance in the second quarter of 2007 was both impressive and much needed, as the company managed to halt the three-quarter market share advance of archrival Intel," Matthew Wilkins, principal analyst for compute platforms research at iSuppli, said in a statement. The advance brought to an end a period of decline for AMD, which saw its market share dwindle from 16.8 percent in the third quarter of 2006 to 10.9 percent in the first quarter of 2007. AMD's rise in the second quarter can be attributed to increased shipments for notebook, desktop, and server microprocessors, despite a decline in the overall microprocessor Average Selling Prices (ASPs), according to iSuppli. Intel's revenue share decrease can be attributed to a decline in its microprocessor ASPs, due to pricing pressure in low-end desktop and notebook microprocessors, iSuppli said. The microprocessor market is currently facing severe pricing pressure, which originally arose when Intel launched its new microprocessor line in 2006. AMD and Intel are continuing to react to each others' pricing, and the feud is expected to continue throughout 2007, Wilkins said. "The combined position of Intel and AMD shows how these two companies have steadily eaten up share from the other microprocessor suppliers ...," Wilkins said in a statement. "This feat is all the more impressive considering our rankings are revenue-based, and that we have seen PC microprocessors under huge pricing pressure in the past 12 months. As the old saying goes: 'when elephants dance, the grass suffers.'"