The market for microprocessors is not immune to the economy or the forces of supply and demand, as was evidenced in a third quarter report from IDC this week.

According to the report, "Worldwide PC processor unit shipments grew 14.0 percent quarter over quarter (QoQ) and 15.8 percent year over year (YoY)."

The surge in Q3 was fueled by demand from the Pacific Rim and a lower price point which has enabled more people in emerging regions to acquire computing devices, according to an e-mail from IDC's Shane Rau, research director, Computing, Networking and Storage Semiconductors.

Chip leader Intel led the charge in new markets with its Atom processor, used in "ultra low-cost PCs" that it calls Netbooks, according to the report. Take away Atom's impact in the market and shipments would have only grown 8.8 percent QoQ and 8.7 percent YoY.

"This year, and for a few years to come, the mobile PC segment in the Asia-Pacific regions, notably China, are driving PC demand and, therefore, PC microprocessor shipments to OEMs for PCs going into those segments," Rau said.

Intel continues to corner the chip market with an 80.8 percent showing in Q3. AMD is a distant second with 18.5 percent.

While shipments of microprocessors hit record levels in Q3, analysts at IDC and in the industry predict a slowing consumption rate in 2009 attributed to concerns of a pending worldwide economic downturn.

"The outlook is uncertain because of concerns for worldwide recession that will lead to slowing GDP growth," Rau said. "That means less corporate and consumer spending on information technologies, including PCs."

Rau said that industry red flags about slowing growth are showing up throughout the PC supply chain, including semiconductor foundries, ODMs and OEMs. IDC stated in its report that both Intel and ADC have "indicated an uncertain outlook" for the year to come.

Source:redmondmag