Intel admits they're likely going to lose server market share to AMDs Epyc through 2018

[Master Disaster]

Disclaimer: the words in this article seem to belong to the analyst and not Intel's CEO, at present no one seems to be able to find any quotes of anything that was supposedly said by him, maybe it was a private "off the record" meeting? Either way take the contents of this thread with appropriate levels of salt, unverified news is just a story.

 

Speaking to Nomura Instinet, Intel's CEO Brian Krzanich has made the admission that AMD will be taking server market share from Intel throughout the rest of 2018.

Quote

Wall Street Analyst firm Nomura Instinet recently spoke with Intel (NASDAQ:INTC 54.52 -0.01%) CEO, Brian Krzanich. Their takeaway was that AMD (NASDAQ:AMD 15.73 0.03%) is most likely going to be walking away with server CPU market share through the second half of 2018 and every single % of this market that AMD wins it will be coming directly from Intel.

Instinet analyst Romit Shah had the following to say

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Mr. Krzanich was very matter-of-fact in saying that Intel would lose server share to AMD in the second half of the year. This wasn’t new news, but we thought it was interesting that Mr. Krzanich did not draw a firm line in the sand as it relates to AMD’s potential gains in servers; he only indicated that it was Intel’s job to not let AMD capture 15-20% market share.” – Romit Shah, Nomura Instinet

Intel are predicting AMD to have 15/20% by the end of the year, AMD themselves are only predicting high single digit% however both would be significant compared to AMDs current 1%.

Quote

The best Intel’s CEO could do is to draw a line in the sand at… 15-20% market share, which if AMD did achieve would be a massive win for the company. For its part, AMD management has gone on record aiming for high single % market share by the end of the year. AMD currently has ~1% market share. Its worth remembering that AMD did reach 25% market share back in 2006 thanks to its very popular Opteron server chips.

https://wccftech.com/intel-ceo-we-will-likely-lose-server-market-share-to-amds-epyc/

 

I wonder if this is share holder damage control mode from Intel? If they over estimate now then by the end of the year they can rejoice over how the best their own predictions and performed better than they expected.

[mr moose]

I would be very interested to see what Brian Krzanich actually said. 

[Master Disaster]

Just now, mr moose said:

I would be very interested to see what Brian Krzanich actually said. 

I thought exactly the same thing tbh, the article never directly quotes him.

[Guest]

Well if EYPC is better cost/performance surely its inevitable? 

[Valentyn]

AMD themselves estimated 10% at best. I would be wonderful if they could get around 15%. A strong AMD helps all PC consumers in the end.

[Morgan MLGman]

There might be something in all this though - I'm currently configuring a two server setup dedicated for virtualization for one of my customers and when I compared a PowerEdge R740 server with two 16-core Intel CPUs (Xeon Gold 6130) with the same specs as the single-socket PowerEdge R7415 that has an AMD EPYC 7551P inside, the server with the EPYC CPU has the same amount of threads and roughly the same performance, draws quite a bit less power, while being over 4K USD cheaper...

2 minutes ago, Master Disaster said:

the article never directly quotes him.

Well, the article is from WCCFtech so that's probably not without a reason

[LAwLz]

5 minutes ago, Valentyn said:

AMD themselves estimated 10% at best. I would be wonderful if they could get around 15%. A strong AMD helps all PC consumers in the end.

AMD has actually estimated "mid-single-digit", which in other words mean 5%.

Quote

AMD management has said the chipmaker will reach mid-single-digit server chip market share by year-end compared with its less than 1 percent share last year. A gain of significant share in the server market for AMD would not be unprecedented. The company hit 25 percent share in 2006.

 

[Guest]

Cool

[porina]

If you practically own the market, and a viable competitor appears, of course the only way to go is down. The "how much" part is what will be interesting. They could still grow their revenue in the market even with reduced share.

[Ordinarily_Greater]

how tho? I mean how they are going to have the same reputation for reliability as Intel's counterparts?

[Guest]

5 minutes ago, Ordinarily_Greater said:

how tho? I mean how they are going to have the same reputation for reliability as Intel's counterparts?

Because they just are so much cheaper and use less power compared to xeon?

[Ordinarily_Greater]

1 minute ago, Some Random Member said:

Because they just are so much cheaper and use less power compared to xeon?

that's a strong point

and i am sure AMD has been working on their Server reliability as well to the point where it could be justified to change to EPYC

[Trixanity]

49 minutes ago, mr moose said:

I would be very interested to see what Brian Krzanich actually said. 

Whether that's real or not is difficult to confirm but it seems that they don't necessarily think AMD will reach double digits but that it's their job to stop AMD before they get there. I think that translates to that it's possible but that Intel has tools and methods available to halt their progress and it therefore remains to be seen.

 

So I think the TL;DR is that if Intel does nothing AMD could potentially gain 15% market share. And even so they might not.

 

PS. I know that doesn't say exactly what he said but the paraphrasing tells a different story in my opinion.

 

Edit: aaaand I just realized that bit is in the OP. Still: I think that's a generous interpretation.

[EsaT]

13 minutes ago, Ordinarily_Greater said:

how tho? I mean how they are going to have the same reputation for reliability as Intel's counterparts?

You mean reliable as in having old design shortcuts taking speculative code execution to include whole lots of Meltdown/Spectre vulnerabilities?

Plugging those vulnerabilities has hit server use performance lot more than home use performance.

 

And before Intel correcting their energy inefficient NetBurst/Pentium 4 failure (by scrapping it) and AMD doing similar mistake with Bulldozer AMD actually had decent share in servers.

And even in supercomputers:

https://en.wikipedia.org/wiki/Itanium#/media/File:Processor_families_in_TOP500_supercomputers.svg

[Ezio Auditore]

So now we know that intel is not like apple.....

[SpaceGhostC2C]

59 minutes ago, mr moose said:

I would be very interested to see what Brian Krzanich actually said. 

I wouldn't be surprised if he said basically what the title says. However, after the AMD flaws episode, I don't exactly take "Wall Street analysts" as a source I'd vouch for  

 

56 minutes ago, Valentyn said:

AMD themselves estimated 10% at best. I would be wonderful if they could get around 15%. A strong AMD helps all PC consumers in the end.

This may as well be Intel acknowledging that AMD is going to climb towards the 10% mark, and stating they must do /intend to do something to contain in below 20% further down the road.

 

31 minutes ago, Ordinarily_Greater said:

how tho? I mean how they are going to have the same reputation for reliability as Intel's counterparts?

They have way more glue.¹

 

 

¹ This is both a joke and true, since the "gluing together" thing is at the root of AMD's competitive advantage in this market.

[mr moose]

1 minute ago, SpaceGhostC2C said:

I wouldn't be surprised if he said basically what the title says. However, after the AMD flaws episode, I don't exactly take "Wall Street analysts" as a source I'd vouch for  

 

 

I only want to see his words because it's rare for a CEO to admit they will loose market share to a competitor.  Usually they only make such admissions after the fact when there is nothing to point the blame at.  Claiming they will makes the investors ask hard questions like why? and saying things like: if this is true you shouldn't be the CEO.

[Ordinarily_Greater]

2 minutes ago, EsaT said:

You mean reliable as in having old design shortcuts taking speculative code execution to include whole lots of Meltdown/Spectre vulnerabilities?

Plugging those vulnerabilities has hit server use performance lot more than home use performance.

 

And before Intel correcting their energy inefficient NetBurst/Pentium 4 failure (by scrapping it) and AMD doing similar mistake with Bulldozer AMD actually had decent share in servers.

And even in supercomputers:

https://en.wikipedia.org/wiki/Itanium#/media/File:Processor_families_in_TOP500_supercomputers.svg

woa, i guess their track record isn't that bad at all

7 minutes ago, SpaceGhostC2C said:

They have way more glue.¹

 

 

¹ This is both a joke and true, since the "gluing together" thing is at the root of AMD's competitive advantage in this market.

yea, literally glued together with IHS instead of ToothPaste ^TM

[leadeater]

1 hour ago, Master Disaster said:

Intel are predicting AMD to have 15/20% by the end of the year, AMD themselves are only predicting high single digit% however both would be significant compared to AMDs current 1%.

I think he is probably talking about new product purchases rather than market share install base. Not everyone is going to be replacing servers and some people will buy extra and the old will still be running. 15%-20% is only realistic for new sales, can't see total deployed systems being that high there is just way too much out there for that to happen and I don't think AMD could even make and ship that many CPUs and server OEMs put them in products and sell that many.

[SpaceGhostC2C]

20 minutes ago, mr moose said:

I only want to see his words because it's rare for a CEO to admit they will loose market share to a competitor.  Usually they only make such admissions after the fact when there is nothing to point the blame at.  Claiming they will makes the investors ask hard questions like why? and saying things like: if this is true you shouldn't be the CEO.

I guess it depends on the context, and also what shareholders are already saying / asking / aware of. You want to be confident and reassuring, but you don't want to look like the "I'm OK with the events unfolding currently" meme in their eyes  

[Misanthrope]

I think that why they could perhaps foresee the hit when it comes to AMD coming in on very aggressive prices, they couldn't foresee (in time that is) the Spectre/Meltdown fiasco.

 

So now IT nerds in some companies can make the case on 2 fronts: It's cheaper, far cheaper. When higher ups reply "We really don't need to be trying to save money on server and compromise stability and security" then the security issues for intel are brought up and now it has gone from "Let's stop confirming meetings for this crazy bearded IT guy" to "Hmm actually, there might be something here"

[mr moose]

5 minutes ago, SpaceGhostC2C said:

I guess it depends on the context, and also what shareholders are already saying / asking / aware of. You want to be confident and reassuring, but you don't want to look like the "I'm OK with the events unfolding currently" meme in their eyes  

If I was a CEO and my shareholders were talking that pessimistically, I'd already be shitting my paints that they wanted to reduce my bonuses let alone have the balls to fan the flames.

[Deus Voltage]

I am noticing a very strange trend as I'm searching for direct quotes from Brian Krzanich. News publications, tech or financial (or both), all seem to be quoting Romit Shah as though his words are gospel, but none of them are willing (or can) provide direct quotes from Intel CEO.

 

I'm inclined to, at the risk of seeming conspiratorial, believe that such a meeting was conducted behind closed doors, and much more was said that "could" not be explicitly divulged to the media. 

 

There is more to this story, we're being fed bread crumbs.

[Humbug]

Despite AMD having the better product I don't see how 15-20% shift can happen in one year.

 

Still AMD will probably get 5-10% and that is really huge for AMD. Because it's a high volume market with big margins. Gonna look great on the balance sheet.

 

Bulldozer was such a disaster that AMD basically lost whatever sever market share that they previously had from the Opteron range. Went down to almost 0. So they can only go up now...

[mr moose]

8 minutes ago, Deus Voltage said:

I am noticing a very strange trend as I'm searching for direct quotes from Brian Krzanich. News publications, tech or financial (or both), all seem to be quoting Romit Shah as though his words are gospel, but none of them are willing (or can) provide direct quotes from Intel CEO.

 

I'm inclined to, at the risk of seeming conspiratorial, believe that such a meeting was conducted behind closed doors, and much more was said that "could" not be explicitly divulged to the media. 

 

There is more to this story, we're being fed bread crumbs.

News stories of Intel losing market share have been doing the rounds since December last year.   It sorta hasn't happened yet so whatever they discussed is not something new or largely significant to the market.  It may just be the case that the story is only bread crumbs and the media are just looking to fatten it up a bit. 

 

EDIT:  or this might just be another case of the media jumping on what Intel "didn't say".