AMD Loses Market Share as Mobile CPU Sales Outsell Desktop for the First Time

Last week we looked at the financial results for AMD which reported a fairly positive financial outlook.  Even though the company was still losing money, they had managed to bring loses under control and investors were most likely hoping Q4 2008, or Q1 2009 would see the chip maker return to profit. These hopes are slowing being dashed by new market share numbers which according to Mercury Research saw AMD’s total share drop to 17.7 percent. This is a drop from 18.8 percent in the second quarter, and a huge plunge from 25.3 percent they enjoyed in the fourth quarter of 2006.

According to Mercury a large contributor to AMD’s drop is the shift from desktop processors to mobile. For the first time, shipments of mobile parts have exceeded their desktop counterparts in the CPU market. A market where Intel is extremely dominate. AMD drastically needs to improve innovation in the laptop arena if it is to slow Intel who is posting record breaking revenues. The processor market on a whole grew 13.3 percent and according to researchers, seems to be somewhat immune to the chaos in the financial markets. AMD managed to bring about a modest increase in the server and notebook markets but this is more the result of the market growth rather than share gains. AMD’s stock price has dropped to $3.03 in afterhours trading, down from its 52 week high of $13.80.

So, do you think AMD can bounce back?