AMD's Priorities

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What does AMD need to do most in the next couple years?  The answers may surprise you.

This forum post (which duplicates data from Mercury Research) provides hard, cold, unspun numbers showing the state of the AMD/Intel competition in the three main segments of the CPU market, notebooks, desktops and servers.

First, it provides AMD’s unit marketshare in each of these fields.  We find that for Q3 2008, they were:

Notebooks: 11.3%

Desktops: 25.0%

Servers: 13.8%

We can see that AMD’s unit marketshare differs considerably by sector, being strongest in desktops and weakest in notebooks.  Unfortunately for AMD, the long-term trend in CPU growth is the opposite, with notebook CPU volume growing strongly while desktop CPU volume stagnates/slowly declines.  I didn’t list notebooks first just to be extra-nasty, Mercury’s research also indicated that Q3 2008 was the first quarter ever where notebook CPU shipments exceeded those for desktops.  

Next comes the revenue marketshare in the various segments.  It’s easy to see that AMD gets considerably less revenue per CPU, no matter what the segment than Intel.  

How much less? 

In servers, we find that in Q3 2008, AMD got 77% of the revenue for the average server chip that Intel did.

In notebooks, we find that in Q3 2008, AMD got 72% of the revenue for the average notebook chip that Intel did.

In desktops, we find that in Q3 2008, AMD got 63% of the revenue for the average desktop chip that Intel did. 

So in the segment where AMD does best, they get (relatively) the least amount of money, but, no matter what the segment, AMD processors sell at a significant discount to Intel processors.

This little table illustrates what AMD’s top priorities are for the next few years.  They need to sell a lot more notebook chips, and they need to get a lot more for what they make, whatever the sector.      

Ed

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