iSuppli Reports Evolution In Semiconductor Industry

Despite Intel's secure position as the industry's most dominant supplier with an 80.4 percent share of industry revenue, up one percent from Q1, that number is down from 80.7 from last year's Q2.

The slight decrease in Intel's numbers did not result in a significant gain in market share for AMD, which accounted for 11.52 percent of global microprocessor revenue in Q2, up from 11.48 percent during last year's Q2.

"The static market share situation might suggest that the second quarter was an uneventful quarter in terms of the competition between the two dominant microprocessor suppliers of Intel and AMD," said Matthew Wilkins, principal analyst for computer platforms research at iSuppli, in a statement.

"However, with the market undergoing rapid growth and fast technological development, the fact that the companies have largely retained their positions indicates they are competing furiously for every tenth of a point of market share."

Overall, industry sales rose 34 percent from the second quarter of 2009. iSuppli accounted for this rapid growth by citing the weakness of the PC market last year. A PC market rebound was seen in the 22.8 percent increase in shipments in this year's Q2, iSuppli said.

In addition to rapid growth, the microprocessor industry also experienced rapid evolution. Graphics-enabled microprocessors powered approximately 38 percent of notebook PC microprocessors shipped in the second quarter, iSuppli said.

Earlier this week, Intel unveiled its new integrated GPU-CPU solution, code named "Sandy Bridge," at its Intel Developer Forum in San Francisco. Meanwhile, AMD offers a similar technology, "Fusion," which offers both GPU and CPU capabilities on a single die. AMD calls these processors "accelerated processor units."

Both companies are aware of the giant leap forward this could represent for the industry as a whole -- and for their rivalry. Intel CEO Paul Otellini said Sandy Bridge would revolutionize PCs all over again, while AMD is promoting its "Zacate" chip as a cheaper, smaller and more power-efficient alternative to Sandy Bridge.

The iSuppli report acknowledged the intensification of the Intel-AMD rivalry amidst all the growth and change in the industry.

"While market and technology conditions have changed dramatically during the past 12 months, the high level of competition between Intel and AMD has not," Wilkins said in a statement. "As circumstances continue to evolve in the second half of 2010, expect these two companies to maintain their epic competitive struggle."