AMD continues relentless market share march

AMD is significantly expanding its CPU market share against Intel, evidenced by over 40% usage among Steam users and a Q2 revenue share of 29.5%, up from 9.5% in 2017, according to Bank of America. This growth is driven by AMD's strength in higher-end CPUs and increasing average selling prices, impacting Intel across traditional PCs, laptops, and servers. Intel's recent strategic partnership with Nvidia for custom CPUs and PC chip development highlights its efforts to counter AMD's competitive pressure and enhance its integrated graphics capabilities.

Analysis

Advanced Micro Devices (AMD) is demonstrating sustained and significant market share gains against Intel, a trend validated by both enthusiast-level data and institutional research. According to Steam's latest hardware survey, AMD's CPU usage has surpassed 41%, with a notable concentration in higher-performance SKUs (speeds over 3.7GHz), indicating strength in more profitable market segments. This trend is corroborated by Bank of America research, which estimates AMD's Q2 CPU revenue market share reached 29.5%, a substantial increase from just 9.5% in 2017. The analysis projects continued growth for AMD through 2025, driven by rising average selling prices (ASPs). Conversely, Intel's share on the same platform has dipped below 60%, with its marginal gains confined to the low-cost sector. This competitive pressure extends beyond gaming PCs to laptops and servers. Intel's strategic response, a partnership with Nvidia to develop custom CPUs for AI platforms and PC chips, is a direct acknowledgment of its competitive challenges, particularly in integrated graphics technology where AMD holds an advantage. This move highlights Intel's defensive posture as it contends with erosion in its core markets not only from AMD but also from ARM-based processors in the server space.

Key Decisions for Investors

• Investors should recognize AMD's consistent market share gains in high-margin CPU segments as a strong positive indicator, supporting a bullish thesis based on a durable competitive trend and rising average selling prices.
• A cautious or underweight stance on Intel may be warranted, as the company is ceding profitable market share across multiple product lines and its strategic partnership with Nvidia is a long-term initiative that may not provide near-term relief from competitive pressures.
• Monitor subsequent market share reports from sources like Mercury Research and Bank of America, as well as ASP trends, to confirm the continuation of this dynamic, while treating any concrete product developments from the Intel-Nvidia collaboration as a potential catalyst for a shift in the competitive landscape.