AMD continues to achieve floor within the information heart, grabbing CPU market share from chief Intel regardless of a big decline in server processor shipments.
General, the processor market took successful within the fourth quarter of 2022, in addition to for the complete yr 2022, as a consequence of decrease demand, ongoing stock corrections, and a slowing economic system, in response to analyst agency Mercury Analysis.
For 2022, complete unit shipments (consumer and server, excluding ARM) had been 374 million and revenues got here in at $65 billion, down 21% and 19%, respectively, in comparison with 2021.
Particular to server processors, gross sales for the yr got here in at 36.1 million models, down 4.2% from 37.7 million in 2021. Revenues had been $24 billion in 2022, down 7.7% from $26 billion in 2021. Mercury’s principal analyst Dean McCarron attributes the sharper drop in income versus models as a result of the common promoting value (ASP) declined.
AMD’s complete share of the CPU market (excluding IoT and customized silicon) rose from 23.3% in 2021 to 29.6%, whereas Intel’s share fell from 76.7% in 2021 to 70.4% in 2022.
Within the server market, AMD’s complete market share grew from 10.7% firstly of 2022 to 17.6% on the finish of the yr, whereas Intel fell from 89.3% firstly of the yr to 82.4%.
Apparently, the server chips which are promoting essentially the most aren’t the most recent and biggest fashions. Slightly, they’re a number of generations outdated. It’s once more a mirrored image of slower turnover within the server market when in comparison with the consumer aspect.
“This can be a enterprise the place merchandise go into the market and so they keep available in the market for a extremely very long time,” McCarron mentioned. “With AMD, it took a extremely very long time for his or her share to begin climbing. AMD has simply been tremendous in line with their execution for years now, and it is paying off.”
Stock and economic system guilty for downturn
A lot of the downturn in shipments is because of extra stock delivery in prior quarters, in response to Mercury Analysis. However there are different elements at play as effectively. CPU suppliers are intentionally limiting shipments to assist improve the speed of stock consumption, for instance. Macroeconomic considerations are additionally driving PC OEMs to scale back their stock, the agency says.
On the server aspect, McCarron attributed the gross sales slowdown to the same old “down” portion of a data-center buying cycle. Sometimes, there are 6 to eight quarters of shopping for for the information heart, adopted by a slowdown in gross sales for the same period of time, as clients set up and deploy the servers they purchased.
“We had a extremely good run up in 2021,” McCarron mentioned. “So, the height of the cycle just about was proper at January 2022. And now we’re heading into the very backside of the cycle, which can most likely be in Q1 [2023]. It is wanting like we’ll have slightly little bit of a deeper-than-the-typical down a part of the cycle and hopefully hit backside in Q1, however we’ll see.”
Intel and AMD had new chips within the pipeline for 2022, however McCarron doesn’t imagine that the Osborne Impact (a time period that describes falling gross sales of a soon-to-be-replaced mannequin) is at play as a result of buying cycles within the server market are for much longer than these of shoppers.
“It is not like shoppers who say ‘oh, there’s one thing new, I will maintain off my buy this month to purchase subsequent month.’ There’s quite a lot of planning that goes into [server purchases],” he mentioned.
And whereas inventories are up for server distributors, they don’t preserve quite a bit available within the first place, McCarron mentioned. “The consumer stock might be on the degree of 1 / 4 or so of complete PC demand. Server inventories are nowhere close to that form of degree. It is troublesome to know what they really are, but it surely’s most likely a number of weeks, not months of stock.”
McCarron mentioned we must always see development return after Q1, barring any financial considerations. He expects considerations in regards to the economic system will seize server consumers’ consideration greater than the Intel-versus-AMD debate. “I’ll say it is wanting like, due to the financial considerations, that this subsequent cycle might not be as sturdy because the previous cycles, so buying behaviors could also be slightly bit cautious,” he mentioned.
Copyright © 2023 IDG Communications, Inc.
