Server demand fuels record CPU sales

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Server demand fuels record CPU sales

Global PC microprocessor shipments grew 8.5 percent in the fourth quarter of 2007 to reach record levels, fuelled primarily by strong demand for servers, according to IDC..

The analyst firm said that growth in overall unit shipments and stable average selling prices stimulated market revenue to grow 9.6 percent sequentially to US$8.7 billion.

Shipments of processors designed for PC servers stood out in the quarter, growing 17 percent sequentially.

Shipments of processors for mobile PCs grew 10.3 percent, while processors for desktop PCs grew 6.5 percent.

IDC analysis also revealed that, within each form factor, the percentage of high-end and mainstream processors grew at the expense of low-end processors.

For example, in the desktop processor segment, high-end and mainstream processors represented 87.1 percent of processors shipped in the fourth quarter, up from 84.6 percent in the third quarter.

"Overall market pricing was very stable in the quarter," said Shane Rau, director of semiconductors and personal computing research at IDC.

"Since server and mobile processors carry a premium over desktop processors, and grew more than desktop processors, they buoyed the market average price.

"The fact that the high-end and mainstream segments within all form factor segments grew faster than the value segments kept pricing even firmer."

IDC attributed this to the aggressive pricing at which suppliers introduced new products in the second quarter, combined with the demand for more robust PC configurations necessary to support Windows Vista.

As the year progressed into the fourth quarter, the pricing drew in more buyers who wanted relatively high-end products to support Vista.

For the full year 2007, total worldwide PC processor shipments grew 12.6 percent compared to 2006. Total revenues grew 1.7 percent to US$30.55 billion.

Processor vendor shares in the fourth quarter did not change significantly from those in the third quarter.

On an overall unit basis, Intel earned 76.7 percent market share, a gain of 0.4 percent, while AMD earned 23.1 percent, a loss of 0.4 percent.
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