Date:01/07/11

Intel microprocessor market share grows despite chip recall crisis

Intel has been given the seal of approval from industry analysts over its handling of the Sandy Bridge chipset recall as market share grew in the first quarter of 2011 despite the recall issue.
Manufacturing market analysis firm IHS iSuppli noted that the company expanded its market share over the first quarter to 82.6 per cent of global microprocessor sales, up from an 81 per cent share in the same period in 2010.The gain comes despite a first quarter in which the company disclosed in January that it would need to replace its Sandy Bridge chipsets following the discovery of a flaw in the SATA chip which controlled hard disk and optical drives.
The recall slowed production of new systems by weeks and Intel estimated that the issue would cost it some $700m through the end of the year.
According to IHS iSuppli compute platforms principal analyst Matthew Wilkins, the company managed the crisis extremely well, reacting to the issue and presenting a solution quickly. "The fact that the company achieved a 25 percent increase in revenue in the first quarter of 2011 compared to the same period in 2010 shows that its chipset concern did not really affect the company to a significant degree," said Wilkins. "
Intel's handling of the issue on both the public relations and business fronts stands in stark contrast to other recent examples of big companies facing major product quality challenges." However, over the year the research firm has a slightly less optimistic outlook for Intel.Wilkins noted that the expected growth in the tablet market, particularly in vendors that use embedded processors other than the Atom chip, would cut into Intel's sales.

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