Jon Peddie Research (JPR) has published a snapshot of its latest PC market analysis, showing that global shipments of Cpus for notebook and desktop pcs have declined by 3 percent over the past 2023, compared to continued constant growth. Shipments for desktop PCs are also continuing to shrink, and JPR predicts that this trend will continue for the next few months in 2024. JPR estimates that in Q1 of this year a total of 6,200 million client-based Cpus were shipped.

That's a reduction of 10% compared to the final quarter of 2023, but 32% better than this time last year. 2023 was a good year for AMD and Intel, with CPU shipments increasing in the 12 months from 4700 million units to 6900 million units.

A small decline at the start of 2024 may be seen as negative, but Jon Peddie, President of JPR, thinks it is not.

"The decline in client CPU shipments in Q1 particularly dumped a number of investors. If it is an indication that the market is stable and has returned to its traditional cyclical behavior, it is actually good news in a sense. If that is the case and you think so, Q2 will go down as well."

The cyclical behavior that Peddie is referring to is when a new range of products is launched and shipments increase. It reaches a low point before the next round of the new model is released, and over time it starts the cycle again, pulling its tail. However, in recent years, the overall trend has been on a slide, as various markets, especially those like China, have been so sluggish. AMD expects to launch the Zen5 architecture later this year, but it is likely to unveil the new Ryzen, Threadripper, and EPYC chips at Computex on May 6. Intel also aims to launch Lunar Lake for mobile platforms and Arrow Lake for desktop PCs again this year, so a glut of fresh chips should provide a healthy boost to global CPU shipments.

Snapdragon X Added to the competition from Qualcomm in the form of Elite and Microsoft's big Windows update, and you have the perfect recipe for a significant improvement in shipping.

One of the potential spanner in the works is whether the market is willing to pay for the expected higher price of products decorated with AI labels. The embedded AI accelerators are all well and good, but if the rest of the chip isn't special, AMD, Intel, and the rest are expecting Intel's Meteor Lake to be the best choice for PC enthusiasts because the CPU part of the CPU (all of these days multiple tiles/chiplets) wasn't better than the generation of processors that preceded it. It was not a big hit.

With billions of dollars being spent across the industry on the construction of new manufacturing plants (not to mention billions of dollars spent on research and development), the disappointing year of shipping is the last thing CPU vendors and investors want.