Tiburon (CA) – Graphics chip manufacturers scored a record quarter:  Shipments were up almost 20% sequentially and 18% year-over-year, according to Jon Peddie Research (JPR).  Nvidia continues to gain traction in the market and closes in on Intel.

The six remaining major graphics chip manufacturers AMD, Intel, Matrox, Nvidia, SiS and Via/S3 shipped an estimated 97.9 million units in Q3 in an unusually strong sequential growth.  While Q2-to-Q3 growth has been in the double-digits since 2002, the 20.2% jump this year has been a bit of a surprise and is an indicator that the global PC market is on a healthy growth path.

Overall, Intel held its lead, shipping 37.2 million units (+21.2% over Q3 2006) and claiming a 38.0% market share, which, however is down 3.8 points from 41.8% the company held in Q3 2006.  AMD posted a slight shipment growth of 8.4% to 18.7 million units, translating into a 19.1% market share, down from 23.4% last year.  Both companies are increasingly under pressure by Nvidia, which scored another successful quarter with 39.3% shipment growth over Q3 2006:  Nvidia shipped 33.1 million units for a market share of 33.9%, up from 32.4% in Q3 of last year.

On the lower end, Matrox kept its shipments at about 120,000 units, SiS saw its shipments drop dramatically from 3.7 to 2.1 million graphics devices and Via/S3 also had to deal with declining shipments, which were down from 7.2 to 6.6 million.   

According to JPR, desktop graphics shipments accounted for 73.6% (72.1 million units) of all shipped graphics chips, bringing the mobile share to 26.4% or 25.8 million units.  Nvidia continued to dominate the desktop market with a 37.8% share over Intel’s 33.5% and AMD’s 17.5% share, JPR said.  On the mobile side, Intel still holds a commanding 50.1%, while AMD regained the #2 spot from Nvidia with a 23.4% over 22.8% advantage.

"The third quarter of 2007 was the second quarter in a row to surprise us.  There was growth in the second quarter, which is normally a slow period, and the third quarter, which is usually good, was a record this time,” said Jon Peddie, president of JPR.  "We attribute the market's performance to increased demand by consumers for multimedia-rich systems, and, to a certain extent, to demands of Vista.