Market shares of Advanced Micro Devices’ graphics division ATI have decreased significantly from the previous quarter in Q3 as a result of the merge between AMD and ATI, Jon Peddie Research agency claims. At the same time, Nvidia Corp., Silicon Integrated Systems Corp. and Via Technologies Inc. managed to demonstrate increased shipments of graphics devices during the quarter, while Intel Corp. maintained its share.

Jon Peddie Research estimates that approximately 76 million PC graphics devices shipped from major suppliers in Q3 2006, a 5.2% increase from the prior quarter and an 11.2% increase over the same period the previous year.

The largest supplier of all graphics solutions during the quarter remained Intel Corp. with 40% of the market. ATI remained the second largest supplier in Q3 2006, but with a 5% sequential decline in shipments and decreased market share. Nvidia, the third largest supplier in Q3 2006, closed the gap with ATI with a 2% sequential increase in shipments and increased market share. Both SiS and Via posted market share and shipments increases during the quarter.

While the merge between AMD and ATI had its effect on ATI’s shipments of integrated graphics processors particularly for Intel central processing units, another reason for the company’s market share declines is late time-to-market with products like Radeon X1950 Pro and Radeon X1650 XT, which are superior than Nvidia’s competing offerings, which allowed Nvidia to enjoy design wins with leading computer makers and in retail channel throughout the whole third quarter.

JPR estimates that approximately 53 million desktop graphics devices shipped in Q3 2006, 31.7 million or 59.5% of which were integrated graphics chip (IGC) parts. The desktop graphics segment saw shipments increased 2% from Q2 2006 to Q3 2006 and shipments grew 4.7% year-over-year. Integrated desktop shipments dropped 3% sequentially (the second consecutive quarter of decline) but increased 3.3% annually. Discrete desktop shipments jumped 10.2% on a quarterly basis and grew 6.8% year-over-year.

Overall, Intel held at 35% of the desktop graphics market, ATI dropped to 22%, and Nvidia grew to 25% market share. In the discrete desktop segment, Nvidia also grew, to 57% share and ATI claimed 43% share during the period.

JPR estimates that a record 22.7 million mobile graphics devices shipped in Q3 2006, 17.4 million of which were integrated chipsets for notebooks. Mobile IGCs claimed a share of 76.8% in the mobile graphics market, up from 75.4% in the prior quarter and up from 72.3% in the same period a year ago. ‘

The mobile graphics segment saw quarterly shipments rise a dramatic 13.8%% and grow 30.2% year-over year. IGC shipments drove growth in the mobile market in the second quarter with a tangible 15.8% growth during the period, and discrete mobile shipments grew 7.5% during the quarter and jumped 9.3% compared to the same period the previous year.

Intel led the mobile graphics market with a 51% share (down from 54%), ATI dropped to a 24% share, and Nvidia jumped with a 8% market share gain to 19% for the quarter.

In the discrete mobile segment, ATI saw shipments decline dramatically on a quarterly basis, while Nvidia saw shipments increase sequentially. Nvidia grew discrete mobile segment share from 37% in Q1 2006 to 53% in Q3 2006. ATI’s segment share fell from 63% in Q2 2006 to 47% in Q3 2006.