Things have been heating up in the x86 market for quite some time now and what appears to be one of the first instances of Intel admitting it lost some market share to AMD have finally occurred. Jason Grebe, Corporate Vice President, General manager Cloud Platforms and Technology Group, speaking to an analyst at the Citi Global Tech Conference confirmed that Intel had lost some market share to AMD and highlighted further challenges that the company will have to tackle to maintain its majority share of the market.
Intel admits losing market share to AMD at recent Citi Global Tech Conference, vows to get more aggressive
You know what they say, the first step to solving a problem is to admit there is one and looks like Intel finally mustered up the courage to admit that it had lost market share to AMD. AMD made quite the comeback with its Zen architecture, overturning Intel's monopoly over the x86 market and setting off a price war at a scale we hadn't seen in the CPU market since the good old 2000s. It is clear in hindsight that Intel did not expect a comeback quite as strong as the one that actually happened but the good news for Intel fans is that the company is admitting the misstep and has promised to rectify it (and thus, the consumers win).
Upon being asked about Intel's market share, Jason Grebe had the following to say:
In general, if there is a CPU sale happening on the planet, we want to be involved in it. So we don't look at any segment of the market and say, okay, we are going to walk away from that segment or that we're not be interested there. We want to aggressively compete in all segments. As we have gone through the supply issue kind of in the last six to 12 months on the PC side, we had to walk away from some low-end mobile share as well as some channel desktop share. But as we continue to improve our supply situation, we'll continue to get more aggressive there. - Jason Grebe, Intel.
Although Jason didn't explicitly admit that the loss in market share was due to AMD (baby steps), he did admit that the company lost market share on the mobile side and desktop. The reason for this is simple of course. AMD's Zen offerings are providing competitive performance at a much lower cost and the same is true for the mobility side as well. Furthermore, Zen and Vega combos are selling quite well (a Zen + Vega HP laptop remains our best selling product in the affiliate category). It doesn't help that the company ran into a supply block as it had to ramp up 14nm products since 10nm wasn't ready yet and lost some more market share because of that as well.
An analyst also inquired about what the company is doing to compete against NVIDIA in the AI and inferencing market and Intel had the following to say about that as well:
Why are people using – why are customers using NVIDIA [in regards to AI applications]? And then what is Intel doing to – are you trying to gain back that market share, offer different solution, the same solution but better? Take us inside the strategy there. - Unknown Analyst
Intel had the following to say about that:
Yes. Sure. So our strategy on AI is pretty straightforward. We are going to start with our Xeon processor, which is our core product line. We're going to build custom ASICs for training and inference to go compete directly against our competition. We're eventually getting into the GPU business 1.5 years, two years from now. And we're going to have a full portfolio products that could service whatever AI is required. And again, from a workload perspective, we're extremely bullish on AI. We think over 70% of workloads over the next couple of years will have some type of AI.
And our strategy at Intel is to have AI in all of our silicon products from the data center all the way out to the edge including our Movidius product lines at the edge all the way back into the data center. So we're extremely bullish about our ability to compete here and gain back share. - Jason Grebe, Intel.
AI and inferencing markets are going to be one of the biggest growth drivers in the coming years and it is clear that the silicon triumvirate (Intel-AMD-NVIDIA) is adopting its strategies to focus heavily on AI. With Intel Xe poised to launch next year, the company will finally enter the GPGPU market for AI inferencing along with its existing Xeon/ASIC/FPGA offerings. With a full stack of AI products, the company could potentially give NVIDIA a hard time and claw back some market share that the big GPU manufacturer currently enjoys.
One thing is for clear though, Intel is finally taking its competition seriously and the only one that wins in a case where all three companies engage in a price war is the consumer.
