CPU Shipments, Especially Desktops, Take Historic Dive on Economic Downturn

pcmag.com:

Demand for PCs has cooled to the point that x86 CPU shipments saw a historic plunge in Q2, according to Mercury Research, which tracks component sales. 

Mercury Research says desktop CPU shipments during the May to June period fell to their “lowest level in nearly three decades," decreasing by more than 15% year over year.

The research firm didn't provide exact shipment numbers, but Mercury Research President Dean McCarron said in an email: "I had to go back to the mid-1990s to find desktop CPU shipments in any given quarter lower than the number of units that shipped in Q2."

In Q1, desktop CPU shipments also saw a historic quarter-on-quarter decline at 30%. "There has been a very long-term decline in desktop PC use in favor of notebooks that is the primary driver over the past decade or more. This was combined with the short-term inventory correction that has resulted in the OEMs (original equipment manufacturers) slowing purchases of new CPUs," McCarron added. "The combined result of both of these is the historic low."

During Q2, CPU shipments for laptops also dropped by over 30% year over year. When looking at total CPU shipments for x86 processors in the quarter, the numbers plunged 19% for the largest year-over-year decline in the 28-year history of Mercury Research’s tracking.

“While data is absent prior to 1994, the on-year decline in CPU shipments is probably the largest since 1984, when the nascent PC market experienced its first major downturn,” McCarron said.

The falling shipments are due to the current economic slowdown, which is causing PC makers to halt orders of new chips, McCarron said. Intel itself posted a rare financial loss in Q2 at $500 million, and blamed part of the problem on PC vendors