GPU Makers Expected To See Slow Start To 2009

It's tough out there for just about everyone these days, but AMD, NVIDIA and Intel could be facing some rather huge hurdles in particular. According to a detailed excerpt from a newly released Jon Peddie Research study, the graphics market in Q1 and Q2 of 2009 are forecast to be especially slow. In fact, it's noted that those two quarters will "probably [showcase] the worst Q1 and Q2 decline we've seen since the Internet bubble burst of 2000."

This grim outlook comes hot on the heels of a somewhat surprisingly weak fourth quarter of 2008 -- a quarter that is traditionally hot with holiday sales of new machines and standalone GPUs. Specifically, shipments of chips that power graphics in PCs, medical systems, point-of-sale terminals, kiosks and digital signs fell by 28 percent in the quarter to 72.35 million units, compared with 100.5 million units during the same period a year ago. When compared to Q3 2008, shipments slipped a staggering 35 percent, which was said to be the "first quarter-to-quarter drop in the fourth quarter in eight years."

When looking specifically at GPU vendors, we see VIA suffering the most with a nearly 72 percent year-to-year drop, while Intel shipments sagged by around 21 percent. AMD saw its own shipments decline 24 percent, while NVIDIA, Matrox and SiS saw decreases of 34 percent, 46 percent and 61 percent, respectively. Not surprisingly, the 40 percent drop in desktop PC shipments was largely to blame, and the general economic climate likely forced to-be GPU buyers to deal with their current frame rates a few months longer.

The silver lining to all of this is that the research does expect Q3 and Q4 2009 to be "strong," but they'll have to