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The workstation market posted another round of steadily improving results for the first quarter of 2010, taking one more solid step in its recovery from the lows of 2009, reports Jon Peddie Research (JPR) after wrapping up its first quarter analysis. While shipments of workstations were stronger that one could have imagined, sales of professional graphics cards set the record.

725 Thousand of Workstations Shipped

The JPR reports that the industry shipped 725 thousand workstations worldwide in Q1, resulting in sequential growth of 1.1% and a year-over-year increase of 25.7%. While a welcome number, the 25.7% gain over the same quarter a year ago should be taken with a grain of salt, as it is more a reflection on how bad the Q1 2009 market performed than how good Q1 2010 turned out.

Instead, it was the sequential gain that this time proved a better indicator of the progress the market is making in its climb back up to pre-recession levels. In periods of flat or even modest growth, Q1 sales tend to lag Q4's, so even a modest sequential uptick is a bullish sign. From that perspective, Q1 2010 was stronger than might first appear, as a 1.1% sequential increase for Q1 signals a market ahead of its normal pace, more evidence of sustained momentum for its recovery from the ugly days of 2009.

1.26 Million of Professional Graphics Cards Sold

What seems to be somewhat unbelievable is that the professional graphics hardware market set a new record for shipments, surpassing 2007 and early 2008 numbers. Apparently, there were 1.26 million of ATI FirePro, Nvidia Quadro and other solutions sold, up 17.6% sequentially and a whopping 77.9% year-over-year.

Not only was growth surprisingly hot, but the market managed to set a new record for units shipped, besting totals from the bullish days of late 2007 and early 2008. Given the exceptionally precipitous downturn of 2009, a new record was not expected quite so soon, but the major beneficiaries Nvidia, which holds the lion’s share on the professional market, and ATI, graphics business unit of Advanced Micro Devices, should be glad with the results as it looks like professionals are now upgrading graphics cards.

Dell Is Back

JPR claims that it is beginning to look like HP's coronation as the new king of workstations might have been premature. After years of closing a major gap to market leader Dell, HP flirted with volume leadership for three consecutive quarters, essentially deadlocked with Dell for Q4 2008 through Q2 2009. Finally, in the third quarter of 2009, HP surged ahead to take the workstation shipment crown outright for the first time.

But HP did not get much time to revel in the top spot, as the very next quarter Dell's shipments surged, in the process virtually eliminating the scant lead HP had been able to manage. In Q1 2010, the company surprised to the upside once more, jumping back in front of HP, 39.3% to 38.1%. Since HP looks to still have a slight edge in revenue, JPR's calling it a tie, but Dell's successfully served notice that workstation market leadership is back up for grabs.

Tags: JPR, Dell, HP, ATI, AMD, Nvidia, Quadro, FirePro, Intel,

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