The big picture: Intel CEO Pat Gelsinger might be feeling like the captain of the Titanic right now, desperately trying to stop Chipzilla from sinking any further as it lurches from one crisis to another. The issues with the Raptor Lake CPUs are just the tip of the iceberg as Intel deals with a declining share in CPU markets, a class action lawsuit, poor financial results, mass layoffs, and Moody's downgrading its senior unsecured rating. It's all led to Team Blue postponing its September Innovation event until 2025.
The latest piece of news Intel could have done without comes from Mercury Research (via PC Gamer). The PC component market research group's most recent report shows that AMD's share of the desktop x86 CPU market reached 23% in the latest quarter, jumping 3.6% year-on-year, while Intel fell from 80.6% to 77%.
It was an even better yearly performance in the laptop market for AMD, where its share jumped from 16.5% in 2023 to 20.3%. But the biggest improvement was in servers, where Team Red's share went up from 18.6% to 24.1%.
Follow up story: Intel promises microcode update for crashing CPUs won't affect performance
Mercury does note that Intel's total x86 chip market share has increased, but that's only due to AMD providing its SoCs for gaming consoles, which have seen their sales, especially Xbox ones, decline as they draw near the end of their current lifecycle and upgrades such as the PS5 Pro are on the horizon.
It's likely that AMD will continue to erode more of Intel's market share in the consumer desktop arena. The issues with the 13th- and 14th-gen Raptor Lake chips have been a disaster for the firm, and we're likely to see this reflected in future sales – despite the extended warranties. Intel is still the dominant force when it comes to desktop, laptop, and server CPUS, but its lead is shrinking all the time.
Earlier this week, shareholders launched a class-action lawsuit against Intel for allegedly concealing problems within its foundry business, which resulted in the company posting weak results, laying off 15,000 people, suspending its dividend, and causing its market cap to fall by $32 billion.
Concerns over Intel's profitability have seen credit rating agency Moody's downgrade the company's senior unsecured rating to BAA1 from its earlier A3 rating. The unsecured ratings outlook has been changed to negative from stable. "The downgrade of the ratings reflects our expectations for Intel's significantly weaker profitability over the next 12 to 18 months," Moody's said.
Intel is undoubtedly feeling the pressure. The company has just announced that its Innovation event has been postponed from September until 2025. In a statement, Intel told PCMag: "Given our financial results and outlook for the second half of 2024, which is tougher than previously expected, we are having to make some tough decisions as we continue to align our cost structure and look to assess how we rebuild a sustainable engine of process technology leadership. We express sincere appreciation to our partners, sponsors, exhibitors, developer communities and our larger team who had committed to support and attend the event."