IDC Claims AMD's Server Market Share Fell 33 Percent Last Quarter
If AMD's server sales were indeed within the company's expectations, it can only mean the company was expecting to be pummeled. According to IDC's figures, Intel finished Q2 with 93.5 percent of the server market, up 3.3 percent, while AMD's share decreased to 6.5 percent, down by the same amount. That's rather depressing news considering AMD's 12-core Magny-Cours (and dramatically reduced prices) were available through the entirety of Q2 with Lisbon popping up right at the end of the quarter. During its conference call AMD noted that it expected to realize the "full value" of its new server products in Q3—if the company's server shipments don't recover, Sunnyvale may be stuck in the doldrums until Bulldozer launches sometime in 2011.
Not all of IDC's report was bad news for AMD, however. Worldwide PC CPU shipments and revenue were up 3.6 percent and 6.2 percent from Q1 2010. That's significantly higher on both counts than the norm; CPU shipments typically grow 1.6 percent from Q1 to Q2, while revenue declines by 2.8 percent. "Such a sequential increase in PC processor shipments alone would have been enough to conclude that the first half was strong for the market," said Shane Rau director of Semiconductors: Personal Computing research at IDC. "However, a modest rise in revenues, too, points directly to a rise in average selling prices. System makers bought more and higher-priced PC processors in 2Q10 than in 1Q10. Digging a little deeper into the numbers shows that they bought more mobile processors and more server processors, while desktop processors remained flat."
Broken out by product segment, mobile shipments were up 6.5 percent sequentially, server processors grew by 6.1 percent, and desktop sales declined by 0.1 percent. Intel's overall market share declined to 80.7 percent with AMD picking up 0.2 percent and the remaining 0.1 percent presumably going to VIA Technologies. Intel gained ground in
desktops through the last quarter (72.2 percent market share, up 0.5 percent), again at AMD's expense, but gave up some ground in mobile. Intel's mobile share is 86.1 percent, down 1.7 percent quarter-on-quarter, with 1.6 percent of that going to AMD.
AMD's mobile gains could help explain why the company pulled Bobcat into 2010. Whereas Bobcat is a new product meant to slug it out with Atom in the netbook/notebook space, Llano will be hard pressed to drive much momentum in the desktop market. If AMD thinks Atom vs. Bobcat is a much stronger match-up than Llano vs. Core i3/i5/i7, it makes good sense to kick Ontario out the door first.
IDC expects unit growth in 2010 to increase by 19.8 percent, but there are caveats attached to that estimate. "Major OEMs cut PC build orders with their contract manufacturers who, in turn, have cut orders for commodity components," said Rau. "While the PC processor vendors re-iterated their solid outlook during their most recent earnings calls, the softness we've seen ultimately makes us concerned for end demand's pull on processors.
Likely, the second half of the year will be seasonal given the early build for Intel's Sandy Bridge and AMD's Fusion architecture launches, but lower than the year-over-year growth seen in the first half of the year. 2011 remains a wildcard in terms of sustainable unit growth."