Intel Atom sales slumped in first quarter

Market research firm IDC released a survey of microprocessor sales in the first quarter of this year and its not good news for the Netbook market.

According to the figures, Intel shipments fell by 33 percent in the first quarter compared to the fourth quarter of last year. That means, said IDC that Intel held overstocks of Atom chips in the new year.

Perhaps more worryingly for Intel, IDC assesses that the cheap as chip Atoms represented 21 percent of its mobile PC processor shipments in the first quarter. Intel has always been shy of the possibility that sales of the Atom would cannibalize sales of its more profitable line of notebook CPUs.

The news for general microprocessor sales is also not good In the first quarter worldwide CPU shipments declined by 10.9 percent compared to the previous calendar quarter, while revenues fell by 25.1 percent in the same period.  The first quarter is not generally a good quarter for CPU sales anyway.

According to IDC, Intel held 77.3 percent share in Q1 2009 – losing 4.7 percent, while AMD held 22.3 percent, a gain of 4.6 percent. The only other X86 player is Via, which held a miniscule 0.4 percent share.

Intel’s share in the notebook market is 84.3 percent, while AMD’s is 15 percent.  AMD gained 4.7 percent in the quarter, picked up from Intel. In the server segment Intel held 89.3 percent, AMD 10.7 percent. In the desktop sector, Intel held 70 percent while AMD held 29.8 percent.

IDC estimates that the PC market is still in a weak condition. Demand from original equipment manufacturers (OEMs) picked up toward the end of the quarter, but it thinks that’s because inventories were being replenished rather than there being any real demand.