Recent figures released by Mercury Research have highlighted a concerning trend for Intel, with AMD gaining ground in the x86 CPU market across desktop, laptop, and server segments. In the second quarter of 2024, AMD’s share of the desktop x86 CPU market grew to 23%, up from 19.4% in the same quarter the previous year. Similarly, in laptops, AMD saw an increase from 16.5% to 20.3%, and in servers, AMD’s market share improved from 18.6% to 24.1%.
Consequences of Declining Console Sales
The overall uptick in Intel’s total x86 chip market share can be attributed to declining sales of AMD’s system-on-chips (SoCs), particularly those used in gaming consoles like Microsoft’s Xbox. As console sales have decreased, AMD’s revenue from this segment has taken a hit. This decline was expected, given the cyclical nature of game consoles and the fact that we are closer to the end rather than the beginning of the current console generation.
While Intel still maintains a dominant position in the desktop, laptop, and server markets, the shift in market share towards AMD is significant. Intel’s share of the desktop x86 CPU market dropped from 80.6% to 77% year-on-year, highlighting the impact of AMD’s gains. In laptops and servers, AMD’s advancements have also eaten into Intel’s market share.
Despite the competition between Intel and AMD, Arm CPUs have not seen significant growth in the PC market. Sales of PCs powered by Arm processors are actually falling, including those in Chromebooks. This decline comes as a surprise given the excitement around Qualcomm’s new Snapdragon X chips, although it is noted that Q2 2024 is still early for widespread adoption of these new processors.
While the current trends show AMD making gains at Intel’s expense, it is important to note that Intel remains the largest player in the PC processor market. Any speculation about Intel’s downfall is premature, as the company still holds the majority of market share in desktops, laptops, and servers. Looking ahead, the introduction of new technologies like Qualcomm’s CPU compliant with Microsoft’s Copilot+ AI standard could shake up the market further.
The dynamics of the CPU market are evolving as AMD continues to challenge Intel’s dominance. The next few quarters will be crucial in determining whether these shifts are temporary or indicative of a larger trend. Intel’s position as a leader in PC processors is not easily threatened, but the recent developments underscore the importance of innovation and adaptability in a constantly changing industry.
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