±Recent Visitors

Recent Visitors to Com-Central!

±User Info-big

Welcome Anonymous


Latest: Kaczor
New Today: 0
New Yesterday: 0
Overall: 6640

People Online:
Members: 0
Visitors: 93
Total: 93
Who Is Where:
01: Community Forums
02: Community Forums
03: Photo Gallery
04: CPGlang
05: Community Forums
06: Photo Gallery
07: Photo Gallery
08: Photo Gallery
09: Community Forums
10: Community Forums
11: CPGlang
12: CPGlang
13: Community Forums
14: Photo Gallery
15: Member Screenshots
16: Photo Gallery
17: Photo Gallery
18: Community Forums
19: Community Forums
20: CPGlang
21: Community Forums
22: Community Forums
23: Community Forums
24: Photo Gallery
25: Community Forums
26: Community Forums
27: Community Forums
28: Photo Gallery
29: Community Forums
30: Home
31: Downloads
32: Community Forums
33: Community Forums
34: Community Forums
35: Community Forums
36: Community Forums
37: Photo Gallery
38: Downloads
39: CPGlang
40: Home
41: Home
42: Home
43: Photo Gallery
44: Home
45: CPGlang
46: Photo Gallery
47: Community Forums
48: Photo Gallery
49: Community Forums
50: Community Forums
51: Community Forums
52: Community Forums
53: Community Forums
54: CPGlang
55: CPGlang
56: Community Forums
57: Photo Gallery
58: Community Forums
59: Photo Gallery
60: Home
61: Community Forums
62: Community Forums
63: News
64: Photo Gallery
65: Community Forums
66: Home
67: CPGlang
68: Community Forums
69: Home
70: Community Forums
71: Community Forums
72: Community Forums
73: Community Forums
74: Community Forums
75: Community Forums
76: Community Forums
77: Community Forums
78: Community Forums
79: Home
80: Photo Gallery
81: CPGlang
82: Photo Gallery
83: Community Forums
84: Photo Gallery
85: Home
86: Community Forums
87: Photo Gallery
88: CPGlang
89: Community Forums
90: Photo Gallery
91: Community Forums
92: CPGlang
93: Home

Staff Online:

No staff members are online!
Intel slipping in the market place? :: Archived
Resolve issues with your computer problems here or read about the latest computer parts and information.
Post new topic    Revive this topic    Printer Friendly Page     Forum Index ›  Hardware

Topic Archived View previous topic :: View next topic  
Author Message

Offline Offline
Joined: Jan 21, 2005
Posts: 6988
Location: Central Illinois, USA
PostPosted: Sat Mar 04, 2006 11:53 am
Post subject: Intel slipping in the market place?

I think deep down we all root for the underdog to win. I don't think we can help it, it's just built into most of us. This is an article written at Cnet that really caught me offguard as it's no secret I'm an Intel fan. But AMD has made some remarkable achievements in the Chipset Market Place.

y Michael Kanellos and Tom Krazit
Staff Writer, CNET News.com
Published: March 3, 2006, 1:20 PM PST

news analysis The giant is taking a nap.

Intel warned on Friday that its revenue for the first quarter would come in at between $8.7 billion and $9.1 billion, roughly $500 million lower than estimates the company issued in January. The Santa Clara, Calif.-based chipmaker cited a weak market and a "slight" market share loss.

Analysts generally agree about the market, but are putting more emphasis on the loss of share. Some have pointed to the momentum shown by Advanced Micro Devices, which has been far more aggressive over the past 18 months. The rival chipmaker has been strengthening its ties to PC makers, most prominently with Hewlett-Packard, and keeping prices low.

What's new:
Intel said first-quarter revenue will fall short of expectations, which will make the second straight quarter it has had bad news to report.

Bottom line:

AMD's market share gains are continuing as Intel navigates a painful transition period between its older chip designs and newer models expected by the end of this year.

"They have been very aggressive about getting share and getting shelf space. We haven't seen a lot from Intel," NPD Techworld analyst Steve Baker said.

AMD's surge can be seen most strongly in the U.S. retail market, which accounts for about 9 percent of global PC shipments. In the first seven weeks of 2006, AMD's share in desktops in that area climbed to 81.5 percent, while Intel's has slid to 18.5 percent, Baker said. That's almost a complete reversal of their typical relative positions.

In notebooks, Intel's share has declined to 63 percent, even though Baker and others generally agree that Intel enjoys a technological advantage in laptops.

The retail PC market itself is holding steady, Baker noted. "Overall volume is OK through the first six to eight weeks of the year. We're still growing in double digits in notebooks and single digits in desktops," he said.

Price plays a key factor. In recent weeks, the average AMD desktop sold in American outlets for $578, Baker said. The average Intel desktop cost $780. In notebooks with Intel chips, the average price was $957, lower than AMD's $1,016.

Other analysts, however, said that not all of Intel's woes can be laid at AMD's feet. For instance, PC sales typically slow by between 5 percent and 10 percent from the fourth quarter to the first. And for the past six years, Intel has seen revenue decline in that period by 7.2 percent, according to its financial statements.

The company reported revenue of $10.2 billion in the fourth quarter. With its updated outlook for this quarter of $8.7 billion to $9.1 billion, Intel is looking at a decline of 14.7 percent to 10.7 percent. Thus, seasonal decline could account for about half or more of the slide.

Price cuts are also a reality. This year, shipments of PCs will grow by 9.3 percent, or even a little more compared with 2005, Gartner analyst Miko Kitagawa has estimated. By contrast, overall revenue will decline by 0.3 percent, she said. That means units sell for a lower price than before. The trend looks likely to continue into 2007, when shipments will increase 7.6 percent, but revenue will rise only 0.6 percent, she said.

Server chip sales

Although server processors represent a small portion of Intel's shipments, the company makes more money on the sale of a server chip than on other processors. The company's struggles to get its Itanium server processor off the ground have been well documented, but Intel is also having competitive problems in this market.

The Opteron chip has lifted AMD's share of the x86 server processor market from virtually zero a few years ago to 14.3 percent in the fourth quarter of 2005, according to IDC. Several high-end customers have installed Opteron servers, and the latest is Google, according to Mark Edelstone at Morgan Stanley. Almost all of that came at Intel's expense.

"Intel has never really had to deal with a competitor in the x86 space that had its act together," said Nathan Brookwood, principal analyst at Insight 64. "But how much of the problem is due to AMD's competitiveness, and how much is due to internal factors like chipsets and inventories?"

Intel has struggled to manage capacity over the last few years, as it has switched to new manufacturing technology. For example, stronger-than-expected demand for PCs last year forced it to stop making chipsets for low-end desktop processors, so it could concentrate on fulfilling all of its processor commitments. That left the door open for AMD to nab market share in desktop PCs. Desktop sales are only growing slowly worldwide, but still represent a large segment of Intel's revenue.

Intel clearly has its eye on the future. The company is in a better position against AMD in the notebook market, and shipments of these are soon expected to overtake desktops. As for servers and desktops, it's pinning its hopes on a new chip blueprint. Next week, at the Intel Developer Forum, the company plans to walk hardware developers through the intricacies of its next-generation microarchitecture (NGMA), which is slated to replace the hurting Netburst architecture in the Pentium 4 and Xeon chips.

Desktop and notebook chips based on NGMA should deliver a 20 percent performance improvement over comparable processors from AMD in the second half of this year, Mooly Eden, general manager of Intel's Mobile Platforms Group, said in a recent interview. AMD disputes this, but it's clear that Intel will be in much better competitive shape with its Conroe desktop chip and its Merom notebook chip, Brookwood said.

Before Intel gets to Conroe and Merom, however, it will have to endure a transition period that looks likely to be difficult, said Kevin Krewell, editor in chief of The Microprocessor Report. Concerns that the company will have to cut inventories to make room for the new chips prompted Merrill Lynch analyst Joe Osha to lower his targets for Intel's 2006 earnings per share on Thursday, even before Intel issued its warning.

It looks like the storm could pass this year for Intel, Brookwood said. Investors punished Intel's stock early on Friday, but the stock closed down only 17 cents at $20.32 on the Nasdaq.

"They clearly are at the tail end of what has been a pretty painful period for Intel," Brookwood said. "They had to tear up their road map and scramble to find new products to drop into the places where the old products were going to appear."

Back to top
View user's profile Visit poster's website Photo Gallery
Display posts from previous:   
Post new topic    Revive this topic    Printer Friendly Page    Forum Index ›  Hardware
Page 1 of 1
All times are GMT - 6 Hours

Archive Revive
This is an archived topic - your reply will not be appended here.
Instead, a new topic will be generated in the active forum.
The new topic will provide a reference link to this archived topic.