Economics for Investors on Ulitzer

Third-quarter shipments of graphics processors were up 21.2% sequentially and Q2 was a strong quarter so graphics maven Jon Peddie feels safe in predicting a Merry Christmas for PCs and the industry.

AMD showed the biggest jump in quarter-to-quarter growth at 30% followed by Intel at 21%.

Intel shipped the most parts at 63 million, over twice as many as its nearest competitor Nvidia. "A total of 119.45 million units were shipped in the third quarter, exceeding the record 111 million units that shipped in Q3 2008," Peddie said. "The crash of fall 2008 is now behind us."

Peddie figures notebook shipments hit almost 56 million units with discrete graphics processors jumping more than 36% over Q2 indicating what the OEMs think will be the hot sellers in Q4.

"Integrated graphics in notebooks," he said "which includes the popular netbooks, increased 27% over Q2 - a great gain but less than discrete." Netbooks will remain popular but they will not have the high market share they had during the recession when they were just introduced. Rather, consumers are expected to "buy up" in the next quarter.

"The channel is full and the products in it will have to be sold off before the OEMs and their resellers take a chance of seeing the channel becoming overstuffed. That suggests that while Q4 is typically a good quarter for PCs, the quarter-to-quarter growth in Q4 may not be as robust as Q3. Graphics are a great leading indicator. The graphics go in before the PC is built or shipped."