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AMD gains market share over Intel

Worldwide processor shipments went up during the third quarter this year and Advanced Micro Devices (AMD) gained market share from Intel over last year despite being hurt by manufacturing problems, according to a study released by Mercury Research.

Shipments of processors during the third quarter went up by just 5% compared to the same quarter last year, according to Mercury Research. “Chip shipments have grown despite flat-to-slow growth in PC shipments worldwide over the past year,” said Dean McCarron, principal analyst at the research firm.

Intel held an 80.3% market share, a small drop from 80.6% market share during the third quarter last year. AMD’s market share was 18.8%, growing from 18.3% market share last year.

Mercury Research’s numbers cover all x86 systems including laptops, desktops and servers. The company did not provide full microprocessor shipment numbers.

“AMD’s Fusion mobile chips for netbooks and laptops are doing much better this year compared to last year, which helped the company gain year-over-year market share over Intel,” McCarron said.

Fusion combines a powerful Radeon graphics core and CPU inside a single chip, and the processors are a giant upgrade over the previous generation of chips shipping last year, the company said. AMD’s Fusion chips compete with Intel processors code-named Sandy Bridge, and both chips were released starting early this year.

“Intel’s latest Sandy Bridge chips are also doing well, but AMD’s processors are finding wide acceptance among PC makers and buyers,” McCarron said. “The lower average selling price of AMD’s chips may have also been an advantage,” he added.

The average price for PC processors was US$107 during the quarter, which was the highest in nearly five years, according to McCarron. The last time processor prices were above $107 was in the first quarter of 2007.

Despite the year-over-year growth, AMD lost market share sequentially to Intel. Intel held a 79.9% market share during the second quarter, compared to AMD’s 19.4%. Manufacturing issues hurt AMD in the short term and a short supply of chips from the company helped Intel gain sequential market share, according to reports.

AMD in September said manufacturing partner GlobalFoundries had problems with chips manufactured using a 32-nanometer process. The yield problems led to a limited supply of AMD’s Fusion chips for mainstream PCs.

“AMD’s desktop chip supplies were especially hurt with the manufacturing issues, and Intel’s desktop processor share went up sequentially as a result,” McCarron said. “In weighing manufacturing problems, AMD chose to meet the quota of laptop chip supplies, which stemmed some of the sequential market-share loss,” he added.

AMD’s mobile chip shipments also exceeded desktop chip shipments during the quarter, primarily due to the weaker desktop growth, according to McCarron.

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