Worldwide semiconductor revenue totalled $262.7bn (£138.2bn) in 2006, a 10.2% increase from 2005, according to analyst Gartner.
“Diverging trends in key markets contributed to a moderate overall growth,” said John Barber, an analyst at Gartner.
“Slowing growth rates in traditional markets such as PC processors were offset by strong gains in DRAM and wireless communications.”
Gartner said that while Intel remained the number one supplier, it had a challenging year, experiencing a worldwide revenue decline of 12%.
Until the fourth quarter of 2006, Intel lost share with its CPUs in the server and consumer segments to AMD. AMD made impressive gains in market share, including the mobile, desktop, and server product families in Dell.
AMD however still remains outside the top ten chip manufacturers when the overall market is considered. Samsung is number two.
Intel revenues were further eroded by an across-the-board price war which impacted Intel the most, said Gartner.
However, late 2006 marked a turnaround for Intel, with the release of its Core 2 Duo and Xeon 5100 series products based on the Merom micro-architecture of dual-core, 65nm CPUs.
Gartner analysts expect Intel to re-capture losses in market share in 2007 with its new product offerings.
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