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New numbers from Mercury Research, a market research company, that are planned to release on Wednesday, show that ATI Technologies has surpassed NVIDIA Corp. in terms of market share for the first time in about five years after the company’s sales skyrocketed during the third quarter of the calendar year.

An industry source has sent X-bit labs the numbers that are presumably planned to be released by Mercury Research on Wednesday, October, 27, 2004. The source who remained to stay anonymous has provided correct information to X-bit labs in the past.

ATI Grabs the Top Spot on the Graphics Chips Market

According to the data, Intel Corp.’s market share in the graphics systems market rose 1% to 39% in the Q3 2004. ATI Technologies’ market share skyrocketed 4% to 27% in the Q3 2004, while its arch-rival’s – NVIDIA Corp.’s – share dropped 8% to 15% from 23% in the third quarter of the year. Intel supplies chipsets that contain integrated graphics cores for mobile and desktop computers, while ATI and NVIDIA concentrate on standalone graphics chips for desktops and laptops.

For the first time for a long time Markham, Ontario-based ATI Technologies managed to leave NVIDIA behind in terms of market share in desktop standalone market segment. Currently ATI commands 55% of the market, up 17% from the previous quarter. NVIDIA supplied 42% of graphics chips for desktops during the Q3 2004, down 16% from the previous quarter.

ATI Technologies also took the lead over NVIDIA in the market of standalone graphics components, which includes both mobile and desktop graphics processing units. The firm supplied 59% of all graphics chips, while Santa Clara, California-based NVIDIA commanded 37% of the market, down 13% from the Q2 2004.

The success of ATI Technologies can be attributed to more affordable RADEON 9800- and RADEON 9600-series graphics cards hitting the market. While NVIDIA’s current GeForce 6-series GPUs offer customers blistering performance and feature-set and is more than just competitive to ATI’s RADEON X-series, the company’s previous generation product family GeForce FX, which generates the majority of revenue for the GPU designer, cannot offer enough performance in a number of modern games, unlike ATI’s 9800- and 9600-series products. With games like FarCry, Doom III and Half-Life 2 available today or shipping this year, both graphics chip designers managed to increase their revenues as a result of higher consumer activity.

Graphics Chip Companies Show Solid Financial Results

Even though Intel Corp. sells the majority of graphics systems available on the market and commands larger part of the market than ATI or NVIDIA, two world’s leading graphics companies manage to increase their revenues little by little as a result of PC market growth.

ATI recently reported revenues of $572.2 million for the fourth quarter of fiscal 2004 (ended August 31, 2004), a 50.3% increase over the fourth quarter a year earlier. Gross margin declined 1.8 percentage points to 33.8% over the same period of the previous year as a result of costs associated with the ramp of a number of new desktop products. Net income2 per share was $0.24 for the quarter compared to $0.09 last year. ATI’s cash position increased $40.9 million during the quarter to $548.9 million as of August 31, 2004.

NVIDIA Corp. also recently announced that it expected to report total revenue for the third quarter of fiscal 2005 to be between $510 million to $515 million, as compared to the previous range of $470 million to $502 million. Third quarter gross margin percentage is expected to be between 31.7 percent and 32.7 percent. NVIDIA will host a conference call to discuss its final financial results for the third quarter of its fiscal year 2005 and the outlook for its fourth quarter on November 4, 2004 at 2:00 PM, Pacific Time.

ATI’s stock was $17.08, market capitalization was $4.26 at press time. NVIDIA’s share cost $14.49, while the capitalization was $2.41 billion at press time.

Officials for ATI Technologies Inc., Intel Corp., NVIDIA Corp. and Mercury Research did not comment for the story. X-bit labs has plans to release more Q3 2004 graphics market numbers according to Mercury Research’s report later.

Discussion

Comments currently: 12
Discussion started: 10/26/04 07:46:32 PM
Latest comment: 11/12/04 02:57:26 AM
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1. 
Why my friend buy ATI - simple - becouse he understand what 9800 means (DirectX 9 support). And NVidia ? 5450, 4500, 9816482634 !
0 0 [Posted by:  | Date: 10/27/04 01:26:45 AM]
Reply
- collapse thread

 
so what about 9000, 9100, 9200? Right, dx8 - and what about x800. No, not dx10, but still dx 9...
0 0 [Posted by:  | Date: 10/27/04 01:52:11 AM]
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I think its best to have a good performing DX8.1 card (9000,9100,9200), than a 5200/5600 bad performing (real bad) DX9 card, dont you think?
Some game developers think the same. FX5xxx series forced to run DX8.0 not even DX8.1.....

DX10 are you crazy no card do that yet. Show me something nvidia 6800 can do that ati X800 doesnt!
0 0 [Posted by:  | Date: 10/27/04 02:38:12 AM]
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Uhmz how about HDR this is an option wich is only availible on nvidia hardware at this time and there are more examples.
And the fx series run a cross between 8.1 and 9.0 in dx9 based games, 8.0 is total b*llsh*t. When you make up stories better make up good ones first ;)

dx8.1 games runs great on nvidia hardware but the shader options (ps2.0) in dx9 are running it's calculations to slow on the fx series, this is true.
0 0 [Posted by:  | Date: 10/27/04 03:08:10 AM]
Reply
 
HL2 ;) for example.

HDR make games look better over Ati? Can you give me a link of a game supporting this to see the image quality difference?
0 0 [Posted by:  | Date: 10/27/04 10:29:24 AM]
Reply
 
Sorry it took so long but here is your link to see the difference:
http://www.nvnews.net/vbulletin/showthread.php?t=39383&page=2&pp=15

2 things though, first it is still in beta stage, and secondly this option is only availible on nvidia 68xx hardware.
This option was released by Crytek in their new 1.3 patch out now.
0 0 [Posted by:  | Date: 10/29/04 09:52:05 AM]
Reply
 
LOL
ATI also suppords HDR it is the name that is different!

Where is nvidia Temporal AA, or 3Dc where, where?
0 0 [Posted by:  | Date: 11/03/04 02:13:20 AM]
Reply
 
And where is Ati 8x super sampeling and full sm3.0 support where where??
I think i'm missing your point, the HDR on ati cards are not even comming close at this moment.
Are you trying to make a flamewar or something?

Both companies are making great cards as we speak and the only thing that mathers to you it seems is that Ati has to be better in every way? Or is this a wrong assumption?
0 0 [Posted by:  | Date: 11/03/04 04:55:03 PM]
Reply

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