AMD gained share in key processor categories in Q1 | Mercury Research

Advanced Micro Devices gained market share in the x86 processor market in client and server categories, according to market researcher Mercury Research.

Competition is always fierce in the x86 processor market — which these days means the rivalry between AMD and Intel. Intel gained some share in the Internet of Things (IoT) market.

Excluding the IoT and semi-custom products (which include game console chips, which AMD makes), the market continued to favor AMD, once again having on-quarter and on-year gains in both client and server segments.

In the first quarter ended March 31, analyst Dean McCarron of Mercury Research said x86 processor shipments were in line with typical seasonal trends for both client and server processors, with all segments down moderately on quarter as is normal for a first quarter.

This past quarter was the first time since early 2020 when the COVID pandemic began that market results have been completely normal in the desktop, mobile and server segments.

IoT/SoC processor shipments declined far more than typical as decreased console demand impacted AMD’s SoC shipments. AMD mentioned in its analyst call that gaming revenue in particular dropped 48% in Q1 compared to a year earlier. As the aging consoles sell in smaller numbers, AMD expects annual comparison to be down in Q2 as well as in the second half of 2024.

Because the year-ago quarter remained impacted by inventory correction efforts, the statistics and share movements reported here in the past few quarters are more reflective of the suppliers differing in the depth and timing of their inventory corrections, rather than indicating sales-out share of the PC market, McCarron said.

The corrections were largely resolved by the third quarter of 2023, so current-quarter share results are probably in line with actual CPU sell-in, and by the third quarter of 2024 most comparisons should be valid — but the on-year results certainly aren’t.

For all-inclusive share, which counts not only PC client CPUs and servers but also IoT and semi-custom products used in items like gaming consoles, Intel gained 2.4 percentage points on quarter. The driver of the gains here was AMD’s shrinking SoC business — while AMD gained total client and server share, the movement was far less than what was needed to overcome dramatically lower SoC shipments. Intel gained share on year as well, again due to AMD’s lower SoC shipments.

Overall share excluding IoT and semi-custom products continued to favor AMD, once again having on-quarter and on-year gains in both client and server segments. Both Intel and AMD saw lower shipments
on-quarter, however AMD’s declines in both total client and server CPUs were relatively smaller than Intel’s, so AMD gained overall share.

Intel did gain share in mobile client in the first quarter, as it continued to ramp Raptor Lake cores (while Meteor Lake ramped as well, it was off a tiny base in the prior quarter and the ramp was slower than expected. Intel noted in their earnings call that packaging capacity was a limiting factor in Meteor Lake’s
shipments), McCarron said.

In addition to the Raptor Lake ramp continuing, Intel shipped an increasing amount of entry-level processors, both the “Intel Processor” N100 and N200 CPUs as well as legacy Celeron processors — shipments on entry-level processors were actually up on quarter, partially offsetting seasonal declines in mainstream CPUs. AMD’s mobile shipments declined more than Intel resulting in the share loss, with the declines happening in AMD’s oldest mobile CPU cores.

Market share changes in desktop were the opposite of mobile, with AMD having nearly flat desktop CPU shipments on quarter — which is far better than typical seasonal trends, and Intel seeing slightly lower than typical seasonal declines.

AMD’s strong desktop showing in a typically steeply down quarter resulted in a relatively large on-quarter and on-year share increase for the first quarter. For AMD the strength in desktop was due to surprisingly strong Vermeer core shipments and the ramp of the new desktop version of the Phoenix Point APU. McCarron said that while Intel’s Raptor Lake 14xxx series CPUs ramped strongly in the quarter, they were replacing the prior generation 13xxx series (also Raptor Lake based) so there was no net upside to the ramp.

Both suppliers saw their stronger client segment mostly offset by the weaker segment, so net client share only moved slightly.

As noted above, the server CPU market experienced typical seasonal declines in the quarter — recall last quarter was the only positive on-quarter growth server processors has seen in 2023, however any increase in the base demand last quarter was more than overwhelmed by seasonal dynamics pulling shipments lower in the first quarter. Both suppliers saw declines very close to the seasonal norm, but AMD’s were slightly smaller declines than Intel’s and AMD’s share was up on quarter (recall Intel gained share on quarter in server for the first time in nearly five years in Q4, 2023, so this was a one-off event for now).

AMD’s share is up significantly on year, and AMD’s server CPU unit shipments were also up on year. Intel’s declines. The suppliers didn’t provide much insight into server CPU dynamics in their earnings
discussions, but for AMD it was apparent that Genoa is the main driver of on-year growth.

AMD also shipped its MI300A product in the first quarter and this is not counted as a CPU; the MI300A is a hybrid CPU/GPU accelerator product. Had these units been counted as CPUs, AMD’s on-quarter share would have been higher.

Estimates showed that Arm PC CPU shipments were nearly flat on quarter, with declining shipments of processors into Apple’s Macs nearly offset by a modest increase in Chromebook CPU shipments.

Mercury Research’s estimate for ARM PC client share (including Chromebooks and Apple’s M-series based Macs with X86 desktop and mobile CPUs in the total client size estimate) in the first quarter is 11.1%, up from an revised fourth quarter estimate of 10.3%.

Mercury Researched noted that it’s highly probable Via’s Zhaoxin’s joint venture share is growing, but we have extremely limited visibility into this small segment of the CPU business.