Crisis In Gpu

GPU shipments hit hard by financial crisis

Author: Tim Smalley

Published: 31st January 2009

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According
to JPR’s estimated graphics cards shipments, the market declined by
almost 35 percent between the third and fourth quarters.

Following hints that GPU shipments were down in the fourth quarter – a
direct result of the economic slowdown – a report released by Jon
Peddie Research this week all but confirms the worries. According to
JPR’s estimated graphics cards shipments, the market declined by almost
35 percent between the third and fourth quarters.



Total GPU shipments for the fourth quarter amounted to 72.35 million,
while the previous quarter’s estimates were pegged at 111.26 million
units shipped. It’s also the first time shipments have dropped between
the third and fourth quarters since the year 2000.



That’s not good news for the industry, but it’s not likely to get
better any time soon because Peddie suggests that we may witness the
worst first and second quarter decline since the dot com bomb of 2000.
He does expect the market to get on the road to recovery in the third
and fourth quarters of this year, though.



Peddie attributed the declines to the global economic slowdown and lack
of consumer confidence – par for the course at the moment. He said
vendors were preparing for a bad quarter, but was still surprised by
the way the market stalled so dramatically.



Looking through the figures provided by JPR, SIS and Matrox were hit
hardest by the economic slowdown, but AMD wasn’t far behind in the
squeeze – its shipments declined by almost 39 percent. Nvidia actually
suffered the least during the fourth quarter, as its sales dropped by
just 28 percent and as a result it managed to steal market share from
both AMD and Intel.



The desktop graphics market has been on a slow decline for a while now,
but Peddie says that the decline accelerated during the latter half of
2008. Despite this, it’s expected that sales will level off during
2009, because there is still significant demand for desktop GPUs in
certain markets.



Both AMD and Nvidia gained market share from Intel in the desktop
segment during the fourth quarter and their shipments now represent
21.4 and 37.9 percent of the market respectively. “Given the tough circumstances of this quarter, AMD's increase is no mean accomplishment.” he said.



The one thing that really surprised us here was the inroads Nvidia made
into the market while the rest of the industry felt the pinch in quite
emphatic fashion. Its low-cost GeForce 9400M integrated graphics
chipset has really hit the market at the right time and this is where
the company has most likely made up the most ground - we expect this
trend to continue through the first few quarters of 2009 when more
GeForce 9400M design wins are announced by system builders.