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Intel & AMD price war hits revenue

Core 2 Duo helps Intel gain chip market share

Intel regained 4.5 percentage points of market share against rival AMD during the first quarter, according to market researcher iSuppli.

Intel took 80.2 percent of global chip revenue during the three months ending 31 March, up from 75.7 percent in the fourth quarter of last year, iSuppli said. AMD's share of global chip revenue dropped to 11.1 percent, down 4.6 percent from the 15.7 percent share of the market it controlled in the fourth quarter of last year.

The market researcher said that although most people knew Intel had gained market share over AMD in the first quarter, the gap was much greater than expected. Sales of Core 2 Duo microprocessors boosted Intel's gains during the quarter, iSuppli said.

AMD reported a far larger loss than expected for the first quarter, $611 million, blaming "significantly" lower microprocessor unit shipments and lower selling prices for its performance. AMD and Intel have been engaged in an ongoing price war for over a year.

Wall Street analysts had expected AMD to post a first quarter loss of $0.48 per share, but instead the company surprised them with a loss over twice that size, $1.11 per share.

AMD's decline in the first quarter represents a major reversal of fortune compared to 2006, when it had the advantage over Intel with its own dual core processors, iSuppli said.

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