Global Q3 Shipments of PC Microprocessors Climbs Nearly 9 Percent, Revenue Up 24 Percent

Researcher IDC says OEMs quick to cut orders at any sign of slowing end customer demand. Points to slower than average quarterly sequential increases. Also forecasts tablets to impede but not stop mini notebook growth.

November 13, 2010

D.H. Kass

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Global unit shipments of PC microprocessors rose by 8.6 percent and revenues increased by 24.1 percent for the third quarter of 2010 when compared to results from the similar period last year, according to researcher International Data Corp.

When viewed on a quarter-by-quarter sequential basis, shipments rose only 2.1 percent and sales by 2.5 percent from the immediately prior period, the company said. On average, worldwide PC microprocessor unit shipments jump by more than 10 percent and revenues by 9 percent from the second to the third quarter, according to the researcher.

IDC blamed edgy OEMs who it said are quick to cut PC processor orders at any indication of ebbing end customer demand.

"Market demand for processors was weak in July and in August," said Shane Rau, IDC director of PC semiconductor research.

"OEMs have become very reactive to any hint of slackening end demand,” he said. “And, when they cut their PC build orders, like they did in late 2Q10 and the first half of 3Q10, not only did they cut their processor orders, they caused their contract manufacturers to cut orders for commodity components. The whole supply chain is skittish."

IDC predicts Q4 global PC processor results will be “decent,” but a strong market for PC upgrades will drive double-digit growth in the sector next year, Rau said.

“For 2011, we believe that, even though the consumer segment will remain stalled in developed regions, IT executives will see PC upgrades as a priority over the next 12 months which should result in double digit growth in PC systems and PC processors units next year," he said.

When viewed by form factor, shipments of desktop PC processors worldwide for Q3 2010 rose 1.7 percent, PC server processors jumped 24.4 percent, and mobile PC processors rose 13.3 percent when compared to the similar period last year, according to IDC.

Overall, Intel Corp. commanded 80.4 percent of the global PC microprocessor market in Q3 2010, while Advanced Micro Devices Inc. owned 19.2 percent of the segment and Via Technologies Inc. garnered a .4 percent share. For the most part, those vendors’ portions of the market remained flat for the period.

Researcher expects mini notebook growth despite tablet popularity

IDC said that manufacturers are on pace to ship globally some 38 million mini notebooks, or netbooks, for 2010, a 10 percent jump from the market’s performance last year. By 2014, the segment is expected to record shipments of more than 42 million units, moving along at a 4.3 percent compound annual growth rate, IDC said.

The researcher said that even though media tablets such as Apple Computer Inc.’s iPad will slow the growth of mini notebooks, the segment still will benefit from a viable market.

"IDC does not expect media tablets to bring about the death of mini notebooks, although there's no question that the focus of attention has shifted to these newer devices," said Bob O'Donnell, IDC program vice president, Clients and Displays.

"Given the range of capabilities and price points, it is very likely that consumers will acquire these devices in various combinations, simply delaying the purchase of a new notebook, for example, to add a media tablet or mini notebook as a companion to their main computing device,” he said.

Acer and ASUS still lead the mini notebook market, combining more about 43 percent of the segment, with Hewlett-Packard Co., Samsung and Dell Inc. trailing, IDC said.

TAGS: PC,Intel,netbook,IDC,microprocessor

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