October 15, 2009 at 8:15 am
Intel has done well riding on the back of the netbook boom. It presented its third quarter financial results yesterday and revealed that so far this year it has sold $1 billion of Intel Atom chipsets. An astonishing number given that this the chip didn’t exist two years ago.
“[Sales of] Atom and the associated chipsets were a bit above $400 million, it was $415 million. Year-to-date, we have sold over, or right at, $1 billion worth of Atom and associated chipsets,” said Stacy Smith, chief financial officer of Intel.
With overall 2009 Intel Atom sales forecasts expected to be in the range of $1.3 and $1.5 billion, it’s clear that netbooks are a segment that people are definitely interested in, despite Michael Dell’s protestations. Of course, you’ll find Intel Atom chipsets in most of the netbooks on the market today. They have an even greater market share in this space than they do in the desktop segment, where there main rival is AMD.
Competitors in the netbook segment are few and far between, AMD has chose to avoid it and the likes of the VIA Nano are still at the fringes. However, this is likely to change next year with smartbooks looking to come to the fore and ARM SoCs (system on chips) looking to take share from Intel in the portable computing segment.
iSuppli is predicting global netbook shipments will rise to 22.2 million units in 2009, up 68.5 percent from 13.2 million in 2008. While Atom represents only a small share of Intel’s total revenue, its profitability is disproportionately high. “Netbook microprocessors are a high-margin product because they utilize old technology,” said Matthew Wilkins, principal analyst for iSuppli. “The Atom is based on the old Pentium M microprocessor and uses a mature manufacturing process. Because of this, Intel is getting very high yields and an extremely high margin on the Atom.”