El Segundo (CA) – The first quarter of this year apparently had a dramatic impact on the microprocessor industry. According to market research firm iSuppli, AMD may have lost almost one third of the market share the company held one quarter earlier.

The first quarter earnings results are likely to reveal just how brutal the current market environment in the microprocessor industry really is. While Intel said earlier today that it the company was able to keep declines in average processor selling prices to a minimum, AMD warned the financial community last week that the firm saw “lower overall average selling prices and significantly lower unit sales, especially in the resale channel” during Q1.

Prices for AMD’s desktop processors fell by an average of about 50%, according to a recent TG Daily analysis . iSuppli told us today that these price cuts were not enough to maintain market shares for AMD. Based on preliminary findings, iSuppli vice president Dale Ford estimates that AMD’s overall market share in the microprocessor industry may have declined 4.7 percentage points from 15.7% in Q4 2006 to 11.0% in Q1 2007. The analyst believes that Intel was able to regain market shares in the same time frame: “On a preliminary basis, I would estimate that Intel increased its market share in microprocessors from 75.7% in Q4 to 79.5% in Q1,” Ford told TG Daily. He described the exchange of market shares as “a big swing” and said that the market share shift was bigger than the firm initially had estimated.

AMD’s Q1 market share loss is somewhat overemphasized in the iSuppli numbers, as they are not limited to the x86 market. However, Intel appears to have come back strong and its dual dual-core microprocessors are scoring big gains, iSuppli said. Intel is also increasing shipments of its quad-core processors – a segment in which AMD cannot compete at this time. Intel expects to have more than one million quad-core processors in the market before the first AMD quad-core will reach its first customers.

Current Analysis reported last week that AMD recently lost its dominance in the U.S. desktop retail market to Intel. According to the market research firm, AMD held a 43% share in Q1, down from about 54% in Q4 2006 and 66% in Q3 2006.

Intel’s chief executive officer Paul Otellini as well as chief financial officer Andy Bryant showed some unusual confidence about Intel’s 2007 financial performance during today’s quarter conference call. The two executives do not believe that AMD’s new processor architecture will dent Intel’s profitability – Intel even raised the margin percentage estimate for the second half of this year. Responding to a related question from an analyst, Bryant said that Intel expects the microprocessor segment to continue to be a very competitive environment. However, he believes Intel to be “in a better position than last year,” as the upcoming 45 nm processors will “differentiate Intel from its competitor.”   

AMD are losers

Apr 18, 2007 02:06     

AMD really should just be content to be #2. They will never do better with that crazed irrational CEO. Hector thank you for running AMD into the ground.
Beavis report abuse vote down vote up Votes: +0

If intel plays fair,it would be happening to them,u...

Apr 18, 2007 02:47     

If intel plays fair,it would be happening to them,ur not following the anti-trust suit,are u? and still with there limited resources AMD have managed to scare Intel,same goes for windows and linux
Amdology report abuse vote down vote up Votes: +0

Not just losers, but BIG losers!

Apr 18, 2007 06:21     

After beating Intel they just sat there re-issuing old technology with minor improvements at a steep price, instead of developing their next killing blow. To top it all off, they were content on relying on crapola Nvidia chipsets, that had the same reliability odds as living off a lottery. I was content to lose a few fps and staying with AMD, but not content at losing my computer a month at a time waiting for my motherboard on RMA. Intel was always smart enough to leap-frog their technology, to try all kinds of innovations that eventually got them back to the top, and had some of the most reliable chipsets. AMD had a decent CPU...once.

Armageddon report abuse vote down vote up Votes: +0

Are you nuts?

Apr 18, 2007 07:35     

The Intel suit (which I think has some merit) is irrelevant. The reason that AMD is in the tank is that Intel's offerings are better. You can buy a Core2 LAPTOP for under 800 bucks (maybe under 700) and that comes with 1gb of ram. No it's not a game machine, but that's a fast machine for peanuts. A desktop from dell with a core2 CPU 1gb of ram, and a 20" wide screen monitor runs roughly 800 bucks. Yes if you want cheaper, then AMD is still the way to go, but Intel's now dominating at all but the lowest levels, and I suspect that even there they're competitive (if you don't care about power useage). I've owned AMD since 2000 and my most recent build was Intel. AMD got caught flat footed, just like intel did a few years ago. Hopefully AMD has the resources to survive. For now I'm concerned. THere's no sign of whether or not their next CPU will perform better than intel and there's every indication that the new GPUs aren't going to beat Nvidia. And none of that is because of intel's less than ethical conduct in years gone by.

KC report abuse vote down vote up Votes: +0

What happened to AMD?

Apr 18, 2007 08:10     

I don’t get it. Intel comes out with one product that wipes out AMD. Did AMD just stop innovating? They seem to be frozen like a deer in the headlights. Possibly, Vista contributed to the problem. Because it’s such a resource hog, everyone is flocking to the faster more efficient CPUs. But didn’t AMD anticipate this? Folks, this isn’t good for anyone. We need the competition keep the prices down. Otherwise Intel will drag their feet on new products and price gouge.

LB report abuse vote down vote up Votes: +0

About Amd and Intel

Apr 18, 2007 08:13     

This is just the latest eppisode in the rollercoaster of business.. Intel was on top, and they were rolling, AMD got ontop, and they were rolling. EXCEPT AMD commited the cardinal sin, They didnt release any new and fresh product.. And kept prices on their product, artificially high, and took over a year to start cutting prices.. No new and fresh products in almost a year, and to top it off, instead of expanding in FAB capicity, they bought a video card company.. ANTI trust-- It is not like they are gonna break INTEL up, i mean, all intel does is make cpu's, and chipsets.. Some other stuff, but that is their bread and butter.. a fine, that will get appealedd.. and its not like amd has anything fresh up their shirt.. ALSO, i call it poetic, since AMD kept their opteron processors priced well beyond their value, and still havent cut prices on those.. Cut the channel out, so only way to order is online, and that is if you can find them, when they were hot.. MADE a deal with DELL, which has backfired, considering AMD's are slower than dirt in todays market, with K?? comming out, they make make some headroom, but the arrogance they displayyed last year, has persuaded many buyers to abandon that company

rippleyaliens report abuse vote down vote up Votes: +0

AMD vs. Intel

Apr 18, 2007 09:49     

At somepoint, a year to year and half ago, I felt like "is Intel going to die soon". Even though they (Intel) had a really bad architecture (NetBurst), they had a strong R&D which kept on doing experiments and bringing new things out of the lab. In fact Intel was innovative for the time being (i.e. HT, pre-fetch algorithms so on). Intel knew what are the critical points and they didn't dare to take processor development limiting decisions. One example is.. Intergrated Mem control (IMC). AMD went ahead with it few years ago and it became the major limiter in developing their main processor. Also I don't think competition keeps prices low. Maybe there would be some innovation. But pricing sense.. whomever the present leader will make a fortune before losing the grip for sure.

Nuwan report abuse vote down vote up Votes: +0

Thanks AMD

Apr 18, 2007 10:40     

Thank you AMD for putting up a good competition against Intel. But then wasn't it AMD that "stole" the blueprint for Intel's 80486 architecture, fudged the lawsuit, and go from there? It seems as though AMD really ran out of things to sell this time. I don't know if it's me though, but ever since AMD came out with K5 I didn't think that AMD would ever pose a problem for Intel. When AMD came out with their Athlons and XP's and 64's and 3000 and IMC and 4000 and Durons and AM2 and X2 and all, they all seemed like puppet play to me. Nothing that AMD ever did had any weight in it. Intel's so called critical "blunder" Netburst was just a learning process for Intel. Without Netburst there wouldn't be Core. Meh. We could argue that Intel is now copying ideas from AMD. Meh. It's a process of evolution I guess. Technology evolves. I mean it'd be illegal to go and copy a block of code that does quick sort from another program but I would be free to take the general idea, and implement it myself, and make it better. When AMD had faster chips out, it sounded like a 121hp Honda Civic with a turbo charger with a nitrous boost system with racing wheels and reduced weight chasis and increased air intake with all the seats removed with strut bars and stuff. I mean it was fast, but with fragility and desperation. That's probably why all my buddies and colleagues were going life-and-death for AMD over Intel. It sounded cool, and looked cool. "D00d AMD gave me 14 extra fps on my benchmark over an Intel system!!!! And I oc'd it and it gave me an extra 6 fps for 3 hours and 22 minutes before it overheated!!! zOMG" Somehow owning an AMD gave you the privilege of being tech-savvy. That's how I see it. I liked Opterons though.

dkfal report abuse vote down vote up Votes: +0

AMD is driving Intel - Still

Apr 18, 2007 11:42     

O you intel lobbyists. Remember what you said a year or two from now. AMD has made a bold move w ATI. Intel is dancing in your face during the regroup. They are dancing fast to impress you cos they need to do that. AMD is saying nothing. Give intel enough rope... The little engine that could - will. The lawsuit is real - and if you support unfair trade practice, you are hanging yourself. A company that will go to any lengths to deny me access to better tek is not my friend. That kinda writing has been out there for years. My choice for my next processor is a moral choice - I can't keep up w the tekwars anyhow. But I do know what's right - and so much of this is so wrong - and you are all fickle and shallow, and you feel insulted by that - you support a lame winner. AMD is the winner of choice for people who are not challenged by the ego game. The dance to impress is very necessary. The next dancer waits in the wings. Remember what you have supported - cos there was a time when Hitlah looked like a winner. I know that biz is biz and morality seems like yadayada - but truth prevails - and I might be wrong - but I see beyond this instant gratification. In Spirit, AMD will always RULE! In fact, be at peace and watch, cos you might eat your words. But watch with eyes open, not as blind babies.

Celestial_Overseer report abuse vote down vote up Votes: +0

WTB socket 939 processors

Apr 18, 2007 12:31     

Well, part of the problem is they just dropped their socket 939 customers. I have the 1.4 GHz amd 64 and would love to upgrade to a 2.8 Ghz... but they're only available for AM2 boards. So dump loyal customers and expect them to remain loyal... not happening.
Ryker Abel report abuse vote down vote up Votes: +0

Agree - AMD Shouldn't Abandon 939

Apr 18, 2007 15:20     

If AMD made X2 6000 processor for the 939 socket, I would buy several right now to upgrade our multiple workstations... As it stands, I have to buy a new motherboard & memory to migrate to AM2... If I am going to buy whole new CPU/MB/MEM combos, I might as well go with Intel's Q6600 quadcore. I'm not trusting the quadcore AMD processors to work with AM2. They are already talking about AM2 and AM3 sockets, so we can count on AM2 as obsolete... I hope AMD succeeds with their new processor releases - we do need healthy competition to keep the prices down. However, I am not going to overspend or buy outdated technology to help the stock of multi-million dollar corporations...

TheRhino report abuse vote down vote up Votes: +0

AMD didnt kill socket 939, Intel did

Apr 18, 2007 19:28     

Intel stopped supporting DDR prematurely and shifted to DDR2, even though DDR was faster than DDR for at least the first 2 years of DDR2's existence! Why did Intel do this? To royally screw over AMD. That is the only logical reason for supporting an inferior memory architecture. DDR2 did not surpass DDR400 in performance until the 3rd generation (PC2-5400) Further, to the Intel shill who was comparing AMD CPUs to a turbocharged Honda... wtf are you talking about? When the X2 came out it totally annihilated Intel, price/performance ratio was at least 40% higher with AMD CPUs and wattage/performance was even better! Now that Intel has the better CPU, AMD STILL has the better price/performance ratio. For all of the last 6 years, AMD has always had a better price/performance ratio average across their product lines. Even today, yes right now, AMD still beats Intel on price, even when you dont factor in the lower cost of AMD motherboards (due to AMD's integrated memory controller). But in America price/performance ratios dont matter. All that matters is who can pump out the most advertising! And Intel definately wins in that arena.

Shadowmaster625 report abuse vote down vote up Votes: +0

AMD needs a new approach

Apr 19, 2007 05:04     

The way I see it AMD is at a crossroads where it either needs a drastic new approach to processor design, or a tech partner with that new approach. Think about it, when AMD crafted the first K7 Athlons, they were unveiling their first chips based on a mostly new and radical design they purchased/licensed from the DEC Alpha CPU. This architecture would prove much like Intel's venerable P6 in that AMD has been able to tweak and enhance the same basic idea for quite some time now. Even in modern K8's the core architecture is strongly based off the old K7 design. I believe AMD needs to take a cue from Intel here, and try out something radical like Netburst. Even though Netburst is widely regarded as a bad thing for Intel, it game them experience working with the high clock speeds and thermal envelopes they needed to deliver a killer Next gen CPU, the Core2. I realize AMD may not be in a financial position to experiment too much, but they need something truly revolutionary to have any chance of major growth. I expect that K10 will be something of a disappointment, and depending on the scale of that letdown AMD could be in serious trouble then. I'm sure K10 will be a competitive chip, but I doubt it will garner any of the clout Core2 has already. Hopefully I'm just being a pessimist, and things will get better once the smoke clears from AMD & ATI's merger, but for now the future doesn't look too rosy for AMD. At least we know that AMD does have a history of releasing industry shaking processors that seemingly break the stranglehold grip of Intel if but for a short while.

Phaxmohdem report abuse vote down vote up Votes: +0

How Amusing!

Apr 19, 2007 10:21     

Oh how amusing to read the uninformed opining of individuals who don't know what they are talking about. You guys might understand some technical detailing around CPU architecture, but you don't know the first thing about business and ethical conduct. Intel is a fierce competitor, but it never, NEVER, uses immoral or unethical actions to win business. There are harsh business realities to deal with for anyone seeking to mount an assault on a company with the market position of Intel's, and those realities include the fact that the large company can outspend you at every turn, most notably marketing, where Intel spends a ton of money to create and reinforce brand recognition. OEM's don't need to be forced by Intel to buy Intel product, the market does that. Intel's brand recognition has been AMD's biggest opponent, and simply because they achieved a momentary (in CPU architecture life-span terms) performance advantage over Intel that only the tech-savvy cna appreciate doesn't mean that they would have instantaneously become the general user CPU of choice. Couple that with the fact that AMD up thorugh 2004 never had a track record of being able to produce their product in any sort of volume, and you can easily piece together why major OEM's wouldn't commit to them. The big PC makers care about four things for their volume products: 1) demand, 2) quality, 3) availability, and 4) price/performance. AMD has always been competitive in price/performance, but they have been notoriously bad in the other three areas. The proof of this is when AMD showed they could produce quality parts of goo dperforming product, and the general buying public said they wanted AMD's part, Dell brought them in. For you guys who aren't part of the business transactions and rely on company spouted propaganda for your opinions, keep writing because I need a good laugh each day!

Chris report abuse vote down vote up Votes: +0

RE: How Amusing!

Apr 20, 2007 08:17     

Yeah I think years ago my economy professor said something like supply and demand. =p
dkfal report abuse vote down vote up Votes: +0

How ABUSING

Apr 20, 2007 12:06     

It is impossible to reason w drunks - esp those drunk on the MoneyGod. Your business ethics, principles, academic econ etc is valid in a biz bored-room, but doesn't account for the existence of Linux, or choices that would be made by an educated public, rather than a public that is told what to think by a bigNrich intel. Support of stupidity, and practices that reinforce that, are not part of the modern business ethic - your abuse is old-school and is ego (fear) based. It will die in the light. You can squash AMD and live in the mundanity of intel and microslop. Recent superior performance was kept from the public - cos it's all naively (!) based on the abuse of biz /money-god. That's your message. Half a laf you. When I see footure shopp /besttbuy display 6 intel pc's and 1 amd that costs less and dusts em all off - that tells me why there's a lawsuit. When you laugh at obvious decency because of foulness taught you, I say the problem is not your fault - but your intent to continue in this world gives you an opportunity to to do something wonderful other than laugh at abuse of power. I am just a baby in the biz world - I have worked in it, and I run my own; but I will not live on sick rules, lest it make me sick - my business is based on honesty and information and a Spirit called Love. If that doesn't fit in your boredroom, that is not your fault. Live in the beautiful world - there's no need for neanderthalic trashing in 2007 - and tell bush about it too. "we can change the world; rearrange the world" Support what you want - is that easy? thx for your post and keep smiling ;) O btw, correct me, if I am wrong, plz. I don't really need to be right in biz rules. Long Live AMD - the underdog that bites intels ass, even now - stay tuned for more - cos they are not stupid people. Support what you Love.

Celestial Overseer report abuse vote down vote up Votes: +0

High Volumn Low Margin or Low Volumn High Margin

Apr 20, 2007 14:43     

These are the two ways of making a business successful. AMD must use the later since there is no way AMD can out-sell Intel in volumn. So AMD should focus on produce really big and bad processors to capture the very top segment of the market -- something like 8-core and quard memory channels and multi-processor possible costing over $1000 each. There will always be that 10-15% of performence nuts to keep AMD afloat.

cz report abuse vote down vote up Votes: +0