As more laptop makers add both integrated and discrete graphics to their PCs, the prospects for graphics chipmakers appear better than the PC makers themselves.
Jon Peddie Research (JPR) found that for the second quarter, the number of graphics chips sold increased 2.5 percent from a quarter ago, while the overall PC market dipped by 4.6 percent. But on a year-over-year basis, the numbers were more what you might expect: graphics units dropped by 6.2 percent, while PC shipments dropped 11.2 percent overall, as this JPR chart shows:
For now, anyway, the market share split between AMD, Intel, and Nvidia remains roughly the same: Intel sold 62 percent of all graphics chips, exactly the same as a year ago. Nvidia increased its market share from 14.8 percent to 16.1 percent, while AMD dropped from 22.7 percent to 21.9 percent.
However, the benefactor of the double-dipping trend appears to be AMD, whose unit shipments in the laptop space increased a whopping 47 percent sequentially.
Why two chips?
Why would a PC maker use two graphics chips? Although a few desktop machines are sold with multiple graphics cards, more midrange and gaming notebooks are being sold with dual GPUs: one, integrated with the processor, provides low-power, basic functionality designed to maximize battery life. The second, discrete GPU kicks in if extra horsepower is needed, such as to run a game.
JPR considers the PC graphics market to be a leading indicator of PC sales, since a graphics chip is sold to a PC maker before that PC is sold to a consumer. Through 2016, JPR predicts that the compound annual growth rate for the graphics market will actually be a decline of 1.6 percent, to 319 million units.
During the quarter, AMD's total shipments climbed by 10.9 percent, although desktop shipments fell by 9.6 percent. Intel's overall shipments also grew by 6.2 percent from the quarter before, with desktop graphics dipping 1 percent and mobile graphics increasing by 12.1 percent. Nvidia suffered uniformly: overall, shipments were down 8.0 percent; desktop shipments declined 8.9 percent, and mobile shipments declined 7.1 percent, all from a quarter ago.