Intel and NVIDIA squeezing VIA and SiS in Q406
Thursday 01st February 2007, 12:12:00 PM, written by Arun
DRAMeXchange has just published their report on the motherboard chipset market for Q406, and VIA also released their January sales figures today. SiS, which also publishes monthly revenue
information, is expected to issue their press release anytime now.
NVIDIA apparently increased their share of the global market from 14%
to 18.4% (which, interestingly, is still lower than in Q106, where they
had a share of 19.7%!) while Intel also increased their share from
56.4% to 58.3%.
The results seem fairly irrefutable: VIA and SiS have been losing share at an extremely rapid rate, and Vista probably isn't going to help either because neither company has any IGP with Vista Premium compliance. One year ago, they had 27.4% and 14.3% share. Today, VIA and SiS are down to 18.4% and 4.1% respectively, according to DRAMeXchange.
But things might be even worse than they seem to be at first glance. These figures are based on shipments, and not revenue. Given the likely repositioning of their product lines given the lack of Vista Premium compliance, and NVIDIA's aggressivity with their single-chip C61V solution, their average selling prices and margins are also likely to be taking a plunge. That means gross profits (loss?) and net profit (loss!) figures must be getting very ugly for them.
In 1H 2007, NVIDIA is slated to announce their C71 IGP for Intel platforms, which could further damage VIA and SiS's position in that market. VIA has their x86 CPU business to survive from, but SiS isn't quite as diversified. They are trying to take a part of the DRAM market by manufacturing DDR and DDR2 at their parent company, UMC, but that is highly unlikely to compensate their decline in the chipset market.
ATI's share in DRAMeXchange's report is mysterious however, as it very clearly looks lower than it should be. While it was to be expected that their shipments would drop substantially because the acquisition made them lose the majority of their Intel chipset revenue, the absolute percentages are much lower than we would expect.
We'll try to figure out why DRAMeXchange's numbers seem very different from Mercury Research's in the coming hours/days, although they do tend to apparently follow the same relative trends. Thus, the previous analysis of VIA and SiS's position is fairly independent of that discrepancy, but it will definitely be interesting to see Mercury's numbers for Q4 and compare them with today's.
UPDATE: Some of those numbers look even more dubious than we first thought, we will update this if we get any more information...
The results seem fairly irrefutable: VIA and SiS have been losing share at an extremely rapid rate, and Vista probably isn't going to help either because neither company has any IGP with Vista Premium compliance. One year ago, they had 27.4% and 14.3% share. Today, VIA and SiS are down to 18.4% and 4.1% respectively, according to DRAMeXchange.
But things might be even worse than they seem to be at first glance. These figures are based on shipments, and not revenue. Given the likely repositioning of their product lines given the lack of Vista Premium compliance, and NVIDIA's aggressivity with their single-chip C61V solution, their average selling prices and margins are also likely to be taking a plunge. That means gross profits (loss?) and net profit (loss!) figures must be getting very ugly for them.
In 1H 2007, NVIDIA is slated to announce their C71 IGP for Intel platforms, which could further damage VIA and SiS's position in that market. VIA has their x86 CPU business to survive from, but SiS isn't quite as diversified. They are trying to take a part of the DRAM market by manufacturing DDR and DDR2 at their parent company, UMC, but that is highly unlikely to compensate their decline in the chipset market.
ATI's share in DRAMeXchange's report is mysterious however, as it very clearly looks lower than it should be. While it was to be expected that their shipments would drop substantially because the acquisition made them lose the majority of their Intel chipset revenue, the absolute percentages are much lower than we would expect.
We'll try to figure out why DRAMeXchange's numbers seem very different from Mercury Research's in the coming hours/days, although they do tend to apparently follow the same relative trends. Thus, the previous analysis of VIA and SiS's position is fairly independent of that discrepancy, but it will definitely be interesting to see Mercury's numbers for Q4 and compare them with today's.
UPDATE: Some of those numbers look even more dubious than we first thought, we will update this if we get any more information...
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