AMD shipped close to 1 million units of its Ryzen 5000 series CPUs during Q4 2020, as PC builders struggled to buy the chips, a research firm estimates.
The shipment volume is over two times more than AMD’s previous largest ramp-up for a new desktop processor, according to Mercury Research, which tracks CPU shipments. “The Ryzen 5000 supply ramp was record-breaking for AMD by a very wide margin,” President Dean McCarron told us in an email.
But if you’re a PC builder, you may be wondering why the Ryzen 5000 CPUs continue to be out of stock at all the major retailers. According to McCarron, the problem isn’t necessarily due to low supplies, but rather the massive customer demand.
AMD "went from zero to nearly a million units or roughly 20% of their desktop shipments in under three months—that's fast,” he said. “It's really just a case of demand far outstripping supply, which is pretty much universal for most CPUs right now.”
Despite the Ryzen 5000 demand, AMD actually lost some share to rival Intel during the fourth quarter in the desktop CPU market, according to Mercury Research, as Tom’s Hardware first reported. AMD’s share fell to 19.3%, down from 20.1% in Q3. A similar drop occurred for AMD’s share in laptop processors.
It marks the first time in three years that Intel retook market share from AMD in the CPU market, according to Mercury Research. The reason is that Intel—which operates its own factories—boosted its CPU production amid soaring demand for PCs during the COVID-19 pandemic. In particular, Intel has pumped out lower-end Celeron and Pentium processors for affordable laptops, including Chromebooks.
In other words, both Intel and AMD grew fast in the quarter—Intel just grew faster, with McCarron also pointing to an earlier backlog of demand for Intel’s CPUs, which gave the company another reason to produce more chips.
“At the heart of the issue is that turnaround time for manufacturing is more than a quarter long so it's a challenge for both suppliers to predict demand and adjust supply quickly,” McCarron said. “It really is just a case of you can only build so much new product so fast and having to allocate what you do have across all product lines.”
Last month, AMD CEO Lisa Su admitted to investors that demand for the company’s chips in the PC market “exceeded” its original forecasts. Unfortunately, the situation may not improve until the third quarter. “The industry does need to increase the overall capacity levels. And so we do see some tightness through the first-half of the year, but there's added capacity in the second-half,” she said.