The CPU industry faced its most significant upheaval in recent months, with a decline in unit shipments for both AMD and Intel. While Intel grapples with challenges, its rivals are capitalizing on available opportunities.
Mercury Research unveiled its report on the CPU sector for the first quarter of 2025, revealing several narratives hidden behind the data. Arm has finally achieved a double-digit market share. On the other hand, AMD is experiencing fluctuations: it is performing well in server markets and desktop PCs but is unexpectedly struggling with notebook shipments.
According to Mercury, the overall X86 processor units saw a decline. This trend is typical for the second quarter, as hardware sales usually peak in the fall and decrease during spring or summer. (Mercury reserves this specific information for its paying clients.)
The total X86 market share, which encompasses PCs, embedded processors, and systems-on-a-chip (SOCs) like gaming processors, continues to favor AMD, which grew by 1.5 percentage points to reach 27.1 percent. Intel holds 72.9 percent of the remaining share. However, when excluding embedded and SOC numbers, AMD experienced a slight loss, dropping 0.3 percentage points to 24.4 percent, leaving the rest to Intel.
Both AMD and Intel also observed sequential growth in server processors, aligning with Wall Street’s view that an increase in silicon shipped for enterprise and AI purposes is beneficial. Mercury noted a remarkable 20 percent growth in server processor unit shipments compared to the same quarter last year.
Arm is also on an upward trend. It has achieved double-digit market share in the client PC market, which includes PCs and Chromebooks. The market share of PCs, Chromebooks, and Apple Mac PCs utilizing Arm chips has risen to 13.9 percent, up from 10.9 percent in the fourth quarter of 2024. This marks the first time Arm has reached double digits in terms of overall share, including servers, which increased from 9.6 percent in the fourth quarter to 11.9 percent in the first quarter of 2024.
“Although Apple’s Mac shipments declined, we observed a slight uptick in ARM CPUs being integrated into Copilot-enabled PCs,” said Dean McCarron, principal analyst at Mercury, in an emailed statement. “Nonetheless, the overall estimate for ARM client was significantly higher this quarter, largely due to what we believe was a considerable rise in processor shipments for Chromebooks.”
Mercury recognized, as in previous instances, that tracking the Chromebook processor market is more challenging than monitoring major PC vendors. Still, he remarked, “the surge in ARM Chromebook activity over the last quarter strongly supports a significant boost in ARM CPU shipments within that segment, alongside gains for Intel’s X86-based N-series chips.”
Intel has managed to navigate the exit of one CEO while hiring another, with layoffs straddling both leadership changes. Both AMD and Qualcomm have seen advantages from this situation.
AMD’s unexpected uptick in desktop shipments took an unforeseen turn. Typically, consumers purchase PC processors during the holiday season, but Mercury noted that buyers were drawn to AMD’s Ryzen 9000 (Granite Ridge) and the 9000X3D models, driving AMD’s desktop (and overall client) selling price to new heights. The average selling price of AMD’s desktop processors actually surpassed Intel’s ASP for the first time in history, McCarron stated.
“The increase in average price was so substantial that AMD’s revenues surged and reached new highs, even though desktop unit shipments fell and are currently less than half of AMD’s peak in that segment,” McCarron from Mercury reported.
AMD’s expansion in the server domain was “many times” that of Intel, McCarron mentioned, achieving a record high of 27.2 percent overall. However, AMD struggled to keep pace with competitors in the mobile sector. Although both AMD and Intel experienced declines, Intel’s losses were considerably smaller than AMD’s, resulting in a 1.2 percentage point gain in market share for Intel. Mercury attributed this shift to Intel leveraging its established success in business PCs, while AMD faced typical declines. (PC manufacturers and, notably, Microsoft have been urging customers to upgrade their Windows 10 computers in anticipation of the end of support for Windows 10 this October.)
Qualcomm has yet to introduce a desktop CPU, which means that Arm’s impact on the PC market has been limited to notebook PCs.
Despite this decline, AMD’s growth in SOCs, which correspond to processors found in gaming consoles, partially balanced the situation. In this area, AMD gained 1.5 percentage points.
One term notably absent from Mercury’s report was “tariffs.” PC manufacturers have previously stated that the CPU market is a sector that generally remains unaffected by tariffs since the top three CPU providers have their “point of origin” in the United States.
AMD is astounded by the strong demand for its X3D gaming CPUs, including the AMD Ryzen 7 9800X3D. This insight comes from an AMD executive, who noted that the chipmaker has significantly increased production to meet the high demand for X3D gaming CPUs among gamers this year.
It’s safe to say that AMD has established a commanding lead in the race to create the top gaming CPU in recent years. The AMD Ryzen 7 9800X3D has received widespread acclaim as the pinnacle of performance, while Intel struggles with products like the Intel Core Ultra 7 265K, which have not yet impressed gamers.
In a conversation with TechPowerUp, AMD’s vice president and general manager for Ryzen CPUs and Radeon GPUs, David McAfee, discussed the company’s current performance. When asked what he would say to gamers facing trouble in purchasing a 9800X3D, McAfee affirmed that demand had far exceeded the company’s expectations and that they would be “adding significant manufacturing capacity” throughout the year to enhance supply.
Just yesterday, we reported that AMD has outperformed Intel in desktop CPU sales by a ratio of 9:1 in some retailers. Meanwhile, last month, another AMD executive pointed to Intel for the stock issues surrounding the 9800X3D, attributing it to the “horrible” launch of Intel’s Core Ultra CPUs, which has resulted in higher-than-expected demand for AMD’s products.
However, McAfee assured that AMD is supplying new CPUs to retailers weekly to alleviate any stock shortages. One challenge for AMD in meeting the demand is that these X3D CPUs require a more complex and longer production process compared to standard chips, as they necessitate an additional 3D V-Cache chip being placed atop the CPU die.
The 9800X3D isn’t the sole gaming CPU on AMD’s radar. The chipmaker also needs to guarantee sufficient stock for the recently announced 12-core 9900X3D and 16-core 9950X3D chips before their launch, particularly with rumors suggesting the 9900X3D may be released as soon as next month.
Fortunately, these remarks indicate that AMD is fully aware of the urgency. With increased production at AMD, gamers can hopefully expect better availability of these premium CPUs, including the 9800X3D, in the coming months.
If you check a list of the best CPUs for PC gaming, you will find that many of the top slots are occupied by products bearing the X3D designation. The newly released AMD Ryzen 9 9950X3D has generated significant demand, leading numerous retailers to run out of stock. AMD Corporate Vice President David McAfee addressed this situation.
In a detailed interview with the YouTube channel HotHardware, AMD Corporate Vice President and General Manager of Client Business David McAfee spoke on various topics related to AMD’s recent hardware launches, including the flagship 9950X3D.
The demand for X3D processors has been “very positive.” McAfee stated, “The demand for the 9950X3D has been exceptionally encouraging.” He elaborated that AMD is focused on replenishing stock levels: “We have a strategy to continually increase our X3D capacity for both the 8-core offerings as well as the higher core count Ryzen 9 products, as we anticipate strong demand across both segments.”
While the X3D designation is typically linked with PC gaming, McAfee indicated that AMD aims to also attract content creators and developers, in addition to PC gaming fans, particularly owing to the 16-core/32-thread configuration of the new flagship chip. He added, “I believe the 9950X3D is ideally suited to serve as the best tool for virtually any task you undertake on your system. We are quite optimistic about how gamers, creators, and developers will embrace the 9950X3D.”
Dave Altavilla, one of the interviewers alongside Marco Chiapetta, praised the competitive pricing of the Ryzen 9 9950X3D: “Its MSRP is $699. When you consider this, it’s still a relatively attractive price for a high-end CPU. Marco and I recall when top-tier CPUs were priced at $1000.”
Times have certainly changed; nowadays, it’s GPUs that tend to carry exorbitant price tags. McAfee discusses this topic as well when addressing the launch of the Radeon 9070 in another segment of the interview.
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