Intel Atom Processor Shipments for Netbooks Drop

Netbooks may have propped up PC sales during the worst of the recession, but the Intel Atom processors behind popular mininotebooks saw their shipments decline by 33 percent in Q1 compared with Q4, proving they are not recession-proof.

The drop in netbook shipments indicates that mininotebook OEMs held significant inventory of Intel Atom processors coming into 2009, according to market analyst firm IDC, which released the number as part of its report on worldwide processor market share for the first quarter.

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Overall, worldwide PC processor unit shipments in Q1 fell 10.9 percent sequentially. From 2008 Q3 to Q4, worldwide PC processor unit shipments fell 17 percent. Year-over-year unit shipments in Q1 2009 were 13 percent lower than Q1 2008.

IDC says that while the decline was slightly more than typically occurs between Q4 and Q1, it indicates that the market’s decline is slowing.

"The PC processor market continued to reflect significant decline in end demand for most of 1Q09," says Shane Rau, director of IDC’s Semiconductors: Personal Computing research, in a prepared statement announcing the results. "However, some inventory replenishment by OEMs at the end of the quarter helped to slow the decline and bring the quarter in at a level only slightly worse than typical seasonal decline."

But that doesn’t mean the declines are over, says Rau. IDC says the PC processor market is still in weak condition, and the firm still expects modest sequential unit shipment declines in 2009.

While OEM demand picked up at the end of the quarter and going into April, IDC remains wary that the demand was due to OEMs replenishing inventories rather than a return of end demand.

Q1 processor revenues also down
In Q1, market revenue also declined, 11 percent from Q4 2008 to Q1 2009, and 18 percent from Q3 2008 to Q4 2008. Year-over-year revenue declined by 25.1 percent, according to IDC.

Intel Atom processors for netbooks represented 21 percent of Intel’s mobile PC processor shipments in Q1 and 6.5 percent of Intel’s mobile PC processor revenues for the quarter, according to IDC.

Intel lost 4.7 percent of its market share in Q1, owning 77.3 percent unit market share. AMD’s unit market share was 22.3 percent, a gain of 4.6 percent, and Via Technologies’ market share sat at 0.4 percent.

By form factor in Q1, Intel earned 84.3 percent share in the mobile PC processor segment, a loss of 4.7 percent, AMD finished with 15.0 percent, a gain of 4.7 percent, and Via earned 0.7 percent, according to IDC.

In the PC server/workstation processor segment, Intel finished with 89.3 percent market share, a gain of 1.2 percent, and AMD earned 10.7 percent, a loss of 1.2 percent. In the desktop PC processor segment, Intel earned 70.0 percent, a loss of 3.9 percent, and AMD earned 29.8 percent, a gain of 3.8 percent.