Jon Peddie Research Discloses Surprising Q1 Results in GPU Industry

[btarunr]

Jon Peddie Research (JPR), the industry's research and consulting firm for graphics and multimedia, announced estimated graphics chip shipments and suppliers' market share for Q1'11. We found that shipments during the first quarter of 2011 behaved according to past years with regard to seasonality, and was nominal on a year-to-year comparison for the quarter. The situation changed over the course of the year and Q4'10 did not conform to the normal seasonal cycle, but was down a bit compared to previous years, so the growth in Q1 was a welcomed change. Our forecast for the coming years has been modified since the last report, and is less aggressive on both desktops and notebooks.



The quarter in general

• In Q1'11, Intel celebrated its fifth quarter of Embedded Processor Graphics CPU (EPG, a multi-chip design that combined a graphics processor and CPU in the same package) shipments, and enjoyed its second quarter of HPU (heterogeneous processor unit) shipments.
• AMD and Intel gained in overall market share at the expense of Nvidia from the last quarter.
• Year to year this quarter AMD had tremendous market share growth, Intel had above average growth, and Nvidia slipped significantly.
• The Q1'11 change in total shipments from last quarter increased 10.3%, significantly above the ten-year average of -4% raising concerns about an inventory buildup that will have to run down in Q2.
• Netbooks continued to contribute to notebook growth. However, the iPad has probably cannibalized some netbook sales.
• Around 83 million PCs shipped worldwide in Q1'11, a drop of 5.4% compared to Q4'10, (based on an average of reports from Dataquest, IDC, and iSuppli) causing speculation on that the 10% up-swing in graphics could be inventory buildup and will have a negative impact on Q2.

Graphics chips (GPUs) and chips with graphics (IGPs, HPUs, and EPGs) are the leading indicator of the PC market. At least one, and often two GPUs are present in every PC shipped. It can take a form of a discrete chip, integrated in the chipset or embedded in the CPU. The average has grown from 115% in 2001 to almost 145% GPUs per PC.

The Q3 to Q4 market change of 2008 was the worst the industry has ever seen with shipments down, -35%. Q4 to Q1 in 2009/2010 marked a shift back into a quarterly seasonality situation, albeit below the ten-year average, that return to normal seasonality was amplified this quarter.

Over 125 million graphics chips and CPUs with graphics shipped in Q1 2011. Intel was the leader in unit shipments for the quarter, elevated by Clarksdale, continued Atom sales for Netbooks, and Sandy Bridge. However, on a quarter-to-quarter basis AMD gained market share at NVIDIA's expense.

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[yogurt_21]

hmm via growth is off .8 to .7 is nearly a 14% drop, not a 1.2% gain.

nvidia losing market share isn't surprising, amd brought out something new, nvidia brought out a refresh. obvioulsy neither the 6990 nor the 590 sren going to affect the charts at all due to low volume sales on both parts.

 

[v12dock]

I expected AMD to pass nvidia

 

[djisas]

And i bet at least 50% of intel market, its not like buyers had a chance and get the intel gpu slapped in their face, just like me, i bought a SB core i3 with integrated and my mb doesnt even support it, P67, so in a way intel is cheating, plus I'd never buy a laptop with intel graphics, I'd rather get AMD graphics like i actually did when i bought one last year...

Good to see AMD in good shape though...

 

[Fourstaff]

hmm via growth is off .8 to .7 is nearly a 14% drop, not a 1.2% gain.

Market share =/= shipments, it caught me off guard too. Note that the 1.2% gain column adds up to only 10%

 

[yogurt_21]

Market share =/= shipments, it caught me off guard too. Note that the 1.2% gain column adds up to only 10%

ah i was reading that wrong. So they did increase unit shipments but since the overall growth was 10.3%, they still lost market share. interesting.


edit: and is it just me or is intel likly inflating these numbers with the igp on sandy bridge?

 

[Fourstaff]

ah i was reading that wrong. So they did increase unit shipments but since the overall growth was 10.3%, they still lost market share. interesting.


edit: and is it just me or is intel likly inflating these numbers with the igp on sandy bridge?

Intel have an almost complete stranglehold in the portable computer market, so their numbers will be much more inflated. Also, IGPs count, so any computer Intel sells will get an automatic +1 to their count. Except for maybe the p67 boards or things like that.

 

[devguy]

AMD's complete replacement of nVidia in the Mac space has helped too. Currently, only the MacBook Air has an nVidia option, and they might not even refresh that (if they do, probably use an AMD chip).

We'll have to wait until the Q2 review to see how the Sandy Bridge chipset problems and launch of the AMD Fusion chips affected growth.

 

[HalfAHertz]

Do they count GPGPU sales? I bet Nvidia soundly leads in those

 

[silkstone]

So Nvidia is now the underdog?

 

[brandonwh64]

SiS -100 LOL

 

[HalfAHertz]

So Nvidia is now the underdog?

No those are SiS, Via and Maxtor

 

[cheesy999]

Maxtor

they were taken over by seagate about 2-3 years ago

 

[HalfAHertz]

they were taken over by seagate about 2-3 years ago

Ow my bad, I meant Matrox

 

[Erazer600]

Video cards: Nvidia - 60.8% ; AMD - 38.8%; Others - 0,4%; LINK

 

[btarunr]

Do they count GPGPU sales? I bet Nvidia soundly leads in those

By GPGPU if you mean Tesla and Stream, that's a unbelievably tiny market.

 

[HalfAHertz]

By GPGPU if you mean Tesla and Stream, that's a unbelievably tiny market.

With an unbelievably huge profit margin *


*read the underlined part with a ferengi voice

 

[Casecutter]

Considering the soon demise of what was the “low-end discrete” (5570/GT430) either in new OEM box's or the user installed upgrade. Lot’s of folk would buy such cards for anemic IGP machines they just purchased, the EPG will bump those positions, and it's really going to affect Nvidia harder.

Especially when most PSU in those newer OEM offerings are going to be 300W, Nvidia’s GT440 isn't the most copasetic to performance/power… no one would go that route. Intel and AMD will get the EPG business and then if a purchaser wants an upgrade without a PSU change in some mid-tower that leaves them at a 6670 for best performance/power.

Although, we aren’t be privy to that, because the W1zzard effectively negated to leave such data missing in his 6670 review. And how does the GT440 compare performance-wise to the GT240 it replaced, don’t know that either as again that crucial information wasn’t provided on that review.

 

[btarunr]

With an unbelievably huge profit margin *


*read the underlined part with a ferengi voice

Even with the profit margin, it's unbelievably small. NVIDIA would have to sell a GF110-based GPGPU card for $20,000 a piece for Tesla to make any difference.

Besides, it's not like NVIDIA makes Tesla cards to stock up inventories. Even if inventories exist, they're tiny, and cater to small purchases. NVIDIA relies on big-ticket purchases (when someone's building a supercomputer), so NVIDIA does build-to-order. Even there, a sale is typically 100~1000 pieces.

 

[Benetanegia]

it's really going to affect Nvidia harder.

I don't think it will affect Nvidia as much as most people think. From the link provided by Erazer:

The AIB market is fueled at the high-end by the gamer, small in volume (~3m a year) but high in dollars (average spend for an AIB ~$300.) The volume comes from the mainstream. And GPU-compute is adding to sales on the high end. The workstation market is about the same size as the gamer, but much it is characterized by higher average selling prices (ASPs).

Along with this other entry from JPR: Jon Peddie Research reports workstation market continues to experience healthy growth, hitting new high

I think they are going to be fine. They are losing market share on the less profitable market, while they are gaining market share and overall shipments in the 2 markets that are more profitable. They have lots of Tegra sales too, which I think it pretty much covers the lost markets and the overall trend suggests that desktop and laptops are on a decline in favor of the devices that Tegra was created for. Basically Nvidia just got kicked from a sinking boat (* they'll just meet death 10 mins earlier than the rest on the ship).

IMO the low end desktop and laptop market, as the mainstream/highest volume market, is pretty much dead, with maybe 1 or 2 years left of supremacy. The future is low power devices like tablets, netops, etc and there ARM reigns supreme currently or in the near future. And there neither Intel nor AMD have any advantage. The real deal breaker (or not) for Nvidia will be Project Denver. The future of Nvidia kinda depends on that project, but my point is that being kicked off the low end GPU market now is not really important, beause they would have been kicked by market trends anyway and everybody is going to be kicked from that market in 1 or 2 years anyways.

Even with the profit margin, it's unbelievably small. NVIDIA would have to sell a GF110-based GPGPU card for $20,000 a piece for Tesla to make any difference.

Besides, it's not like NVIDIA makes Tesla cards to stock up inventories. Even if inventories exist, they're tiny, and cater to small purchases. NVIDIA relies on big-ticket purchases (when someone's building a supercomputer), so NVIDIA does build-to-order. Even there, a sale is typically 100~1000 pieces.

Yes but you are forgetting the workstation market bta. That market is big according to the link by Erazer, as big as the high-end GPU market (knowing that for the first time actually surprised me) and profits are much bigger there. There's no doubt then that Nvidia's strategy with Fermi actually works well for them, since I think they have a market share close to 90% and the cards are really faster than AMD's in that department.

Tesla and Quadro cards are really similar and benefit from the same kind of architecture so goign after GPGPU is just a way to sell some more high-end GPUs at a massive profit margin. It's win win really.

Even if they only sell 1000 Tesla cards, at their price that's about $2+ million revenue and most of it is profits, can you even imagine how many GT430's they have to sell in order to achieve $2 million profits? (200k? 500k?) Like the quote above says mainstream cards are there for volume, but volume is not completely necessary. Just look at Apple before the iPod.

 

[MrMilli]

These numbers are made up by units shipped not revenue!

 

[Benetanegia]

These numbers are made up by units shipped not revenue!

Yup and the worse part is that it includes GPUs on die, like SB, Fusion, etc. It's too confusing now, because most people who buy a retail SB CPU most probably will never use the GPU. It's been shipped yeah, and it's there, but it contributes to market share and shipment numbers that hardly represent the reality and mind share. With IGPs at least someone could make the case that maybe... some or most of those who bought a MB with integrated graphics may actually want to use them. Soon enough every CPU will have a GPU on die and which figures are we going to get? Useless ones that for sure. As useless as when we see a list of the best selling games of all time and the 5 on top are games that Nintendo bundled (aka gave away) with their consoles...

 

[Casecutter]

I don't think it will affect Nvidia as much as most people think

That statement was probably a little harsh...

SB CPU most probably will never use the GPU

Good point for every CPU either side sells they get a point (for being and EPC) even though most with at least a i5/(what ever AMD mid-range on up will be) you know darn good and well will have a discrete upgrade.

Soon enough every CPU will have a GPU on die and which figures are we going to get?

Exactly...

And I certainly would imagine “low-end discrete” chips will cease to be new releases, when the 28Nm parts start to show. Might be smart to hold on to any 5570 and GT220 they might have some value in the short term.

 

[Benetanegia]

And I certainly would imagine “low-end discrete” chips will cease to be new releases, when the 28Nm parts start to show. Might be smart to hold on to any 5570 and GT220 they might have some value in the short term.

I guess they will have to release something on the low end. And this goes for both Nvidia and AMD. IMO it's naive to think that revenues/profits derived from EPG can match that of low end graphics sales. In fact I don't think EPG will have any sort of attributable profit attached, CPUs are just CPUs and IMO are going to be perceived that way, so a CPU that is ment to replace a $150 CPU will have to be sold for that much (+maybe $5), regardless of if it has a GPU attached or not. Just look at Sandy Bridge, it has been sold for what you would expect such CPUs to cost, meybe even less according to their performance/price being so much better than previous Intel CPUs.

I don't think AMD or Intel are going to be able to get away with asking more for the GPU component. I just find it hard to believe that after so many years almost giving away IGPs (compared to the price of chipsets) they will be able to make real money out of EPG. IMO it's just the evolution, something expected by the industry that they had to make even though it's not the most profitable way for them (specially AMD). Of course AMD sees this as a way of increasing their CPU and platform sales which is far more profitable than the low-end GPU market, but let's see if that turns out well. First Bulldozer performance figures are less than stellar so I don't know how good their future CPUs will be, no on die GPU will save them if their CPU component can't compete with Ivy Bridge.