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AMD and Intel underline the importance of diversification

If those resellers that had traditionally made their corn selling PCs and laptops wanted anymore evidence of where the market is going they only have to look at AMD and Intel

The last week has seen both opf the major chip producers deliver their latest financial results and provide an indication that both AMD and Intel see a future away from a reliance on their traditional markets.

Although commercial desktop sales had a bounce in the latest quarterly figures from IDC the long term decline in PC shipments continues and has forced those firms that were once reliant on that form factor to diversify.

Just as AMD and Intel have broadened their reach so have the channel, which now looks for revenues from a variety of hardware devices and not just the laptops and desktops of old.

On Friday AMD revealed second quarter numbers that showed it had returned to year-on-year revenue growth for the first time since 2014.

That return to growth, which led to its shares also hitting four year highs, was helped by the moves the firm has made into gaming and virtual reality.

"In the second quarter we accomplished a significant milestone as we returned to non-GAAP operating profitability based on solid execution and strong demand for our semi-custom and graphics products," said Lisa Su, AMD president and CEO.

Su has been masterminding a turnaround at the firm, which only last autumn had to lay-off a couple of thousand because of ongoing weakness in the PC market.

The movement by the firm into growth areas comes at a time when its computing and graphics revenue dropped by 5% from Q1, as a result of decreased sales of desktop processors and chipsets.Overall though turnover climbed by 23% sequentially between the first two quarters of this year.

Revenue was also up for the second quarter over at Intel, which reported a 3% improvement to $13.5bn, as it trumpted the moves it had made to focus on 'smart connected devices'.

AMD might be focusing on gaming and virtual reality but Intel is opting for other areas of growth and is hoping to cash in on the demand for data centres and the emergence of IoT products.

"Second-quarter revenue matched our outlook and profitability was better than we expected," said Brian Krzanich, Intel CEO.

"In addition, our restructuring initiative to accelerate Intel's transformation is solidly on-track. We're gaining momentum heading into the second half. While we remain cautious on the PC market, we're forecasting growth in 2016 built on strength in data center, the Internet of Things and programmable solutions."

The firm's Internet of Things, data centre, programmable solutions group and security Groups were all up in terms of year-on-year revenue but the traditional client computing group turover was down by 3%.

Both vendors show that the future is away from the desktop and the growth opportunities that the hardware channel need to be looking at include a variety of options.

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