Jon Peddie Research: PC Graphics Shipments Rise in Fourth Quarter, Mobile Graphics Set Record

TIBURON, CA—January 31, 2005—Jon Peddie Research (JPR),
a leading research and consulting firm for graphics and multimedia,
today announced estimated graphics shipments and supplier market share
for the fourth calendar quarter of 2004. Detailed fourth-quarter results
are available in the Q4’04 edition of Jon Peddie’s Market Watch,
the firm’s quarterly graphics survey. Market Watch provides an
in-depth look at the PC graphics market and includes unit shipment and
segment market share data, trend analysis, shipment forecasts, and profiles
of major suppliers.

Jon Peddie Research estimates that approximately 64.1 million PC graphics
devices shipped from eight suppliers in Q4’04, a 1.5% increase
over the previous quarter and a 3.3% increase over the same period the
previous year. The desktop graphics segment saw a 2.2% decline in quarterly
shipments, but discrete desktop shipments increased 12.3% sequentially.
Integrated desktop shipments fell 11.0% on a quarterly basis.

ATI maintained its lead in the discrete desktop segment, but by a narrower
margin than in the third quarter. ATI’s discrete desktop shipments
increased 5.7% sequentially, and its share in the segment fell from
55.1% in Q3’04 to 51.9% in Q4’04. In contrast, Nvidia’s
discrete desktop shipments increased 21.6% sequentially and its segment
share grew from 43.2% to 46.7% during the same period.

A record 14.7 million mobile graphics processors shipped from six suppliers
in Q4’04, up 16.3% from the previous quarter and up 21.3% year-over-year.
Mobile graphics also held a record 22.9% share of the total graphics
market during the period. Shipments of integrated graphics chipsets
for notebooks outpaced those of discrete (stand-alone) mobile graphics
processors in Q4’04, showing sequential growth of 21.5% and annual
growth of 32.3%. Discrete mobile controller shipments grew at a more
modest 10.5% sequentially and 10.2% year-over-year.

ATI was the largest supplier to the mobile segment in the fourth quarter
but with its share falling from 49.9% to 42.9% sequentially. ATI’s
loss of share came on increased shipments from Intel of integrated chipsets
for notebooks and increased shipments from Nvidia of discrete mobile
graphics. Nvidia grew its shipments of discrete mobile graphics more
than 25% during the period and increased its segment share more than
three points, from 22.6% to 25.7%. Intel grew its share in the mobile
IGC segment more than seven points, from 64.7% to 71.8%.

“Although overall industry growth was modest in the fourth quarter,
several segments and suppliers displayed strong performance,”
said Lisa Epstein, a senior analyst at Jon Peddie Research. “The
mobile segment saw record shipments and share of the total graphics
market, and discrete desktop shipments rebounded on increased shipments
from both ATI and Nvidia. The only drag on the market was the desktop
IGC segment, with shipments falling sequentially but growing year-over-year,”
Epstein concluded.

Intel saw a 6.2% sequential increase in graphics shipments in Q4’04,
was the largest supplier of PC graphics devices worldwide, and claimed
an increased share of the total graphics market. ATI was the second
largest supplier in Q4’04 with 2.3% shipment growth and approximately
flat share of the total graphics market. Nvidia was the third largest
supplier in Q4’04, with 18.1% shipment growth and increased market
share. The following table lists the ranking and relative market share,
based on unit shipments in Q3’04 and Q4’04, of the eight
major graphics suppliers to the PC industry.