Advanced Micro Devices (AMD) managed to reverse Intel market share gains in the first quarter of 2009, reports market research firm iSuppli.

Intel lost 2.5 points in market share to 79.1 per cent, its first decline after a year of gains. AMD gained 2.3 points to 12.8 per cent.

Matthew Wilkins, Suppli’s principal analyst for compute platforms research, said that AMD's gain was an "impressive feat given the economic downturn and the weakness in the PC and server markets, which caused global microprocessor revenue in the first quarter to decline by 20.6 percent to $6.9 billion, down from $8.6 billion during the same period in 2008."

He said AMD had strong performance across all of its microprocessor portfolio, especially in notebooks.

Intel's lost share was largely due to weakness in PC and server markets. Overall, the microprocessor market shrank and both Intel and AMD lost revenues because of the poor economy.

The 2009 microprocessor market is forecast to be $28.6 billion, down 15.8 per cent from $34 billion in 2008.

iSuppli tracks all types of microprocessors not just X86 compatible chips.

Foremski's Take:

It's good to see AMD making a strong comeback because it is good to have competition in the largest sector of the microprocessor market. It helps to keep prices competitive. And with a strong performance, AMD will be able to show potential customers it is still in the market which will help it win new business.