Chip giants compete in the PC CPU battlefield!

Nobody wants to miss the opportunity of PC replacement, especially chip suppliers. Chip manufacturers have hailed the AI trend as the "biggest transformation" in the PC industry in nearly a decade, marking a moment of resurgence in the sluggish PC market. According to Canalys data, in the third quarter of 2024, the shipment volume of AI PCs reached 13.3 million units, accounting for 20% of the total PC shipments in the quarter, with a 49% increase compared to the previous quarter. Some data even predicts that by 2025, the global shipment volume of AI PCs is expected to reach 114 million units, achieving a growth of 165.5% compared to 2024. The immense potential of the PC terminal market is driving the chip market to new heights. Market research firm Jon Peddie Research released a report on the global CPU market in the third quarter of 2024, showing a 12.2% increase in global PC CPU shipments compared to the previous quarter, and a 7.8% increase year-on-year. Some forecasts predict that the AI PC processor market will grow to $35 billion by 2029, with a compound annual growth rate of 42%. It is evident that the rise of AI PCs signifies a new round of growth in the entire PC processor industry. Major chip manufacturers are entering the market, new technological architectures are constantly emerging, and the competitive landscape is undergoing a profound reshaping. Is the PC processor market landscape being reshaped? It is well known that the PC CPU market has long been dominated by x86 architecture, with Intel Corporation holding a dominant position in the PC chip sector, thanks to the longstanding Wintel alliance with Microsoft Corporation, which gave it a strong foundation in the traditional PC market. In 2023, Intel Corporation was the first to propose the concept of AI PCs and launched the Core Ultra series processors at the end of that year, emphasizing the role of the NPU in the new architecture, attempting to gain an advantage in the AI PC chip field. However, AI has elevated NVIDIA Corporation, energized AMD, and become the beginning of Intel Corporation's Waterloo. In 2024, Intel Corporation continued to make efforts and released the Core Ultra 200V series processors. This processor series adopts the new Lunar Lake architecture, making bold innovations to meet AI PC requirements for energy efficiency and efficiency, and emphasizing a balance between efficiency and energy consumption as well as long battery life, with AI computing power reaching 120 TOPS, efficiency cores increasing by 68%, and power consumption decreasing by 30%. However, the market feedback on its AI computational capabilities was very muted, as consumers and review organizations were all focused on its energy efficiency ratio. Objectively speaking, an increase in energy efficiency ratio is a good thing for users, as it allows Windows PCs, which have always lagged behind in battery performance, to compete with ARM PCs represented by Apple Inc. But for Intel Corporation itself, this is a bigger "debacle". Some analysts even suggest that these improvements are not the result of Intel Corporation's chip manufacturing process advancement, but rather a result of some of the chip production being outsourced to Taiwan Semiconductor Manufacturing Co., Ltd. With product issues persisting, the market data reflects these problems, as reported by Mercury Research, Intel Corporation's market share in desktop and laptop CPUs decreased by 5.7% and 2% respectively from the previous quarter. Some voices suggest that Intel Corporation's market share will continue to decline, and if competitors like AMD adopt more aggressive pricing strategies, the rate of market share decline will be faster. If, in the short term, Intel Corporation cannot produce more competitive products and address the "hidden concerns" of consumers regarding its previous generation products, especially high-end CPU models, the competition in the desktop CPU market may see a possible reversal. AMD, rising rapidly In recent years, Intel Corporation's dominance in the PC processor market has been gradually eroding, resulting in its leading edge being weakened. The first challenger to Intel Corporation is AMD, also within the x86 alliance. Compared to Intel's lackluster performance, AMD performed well in 2024, gradually emerging as a market leader. AMD has been steadily advancing in the field of AI, starting later but quickly gaining recognition for its superb craftsmanship and market acuity. Especially in the consumer CPU sector, it was only in the middle of 2024 that AMD started introducing NPU units in its CPUs, but through solid product polishing and enhancement, users and businesses are more willing to pay, coupled with Taiwan Semiconductor Manufacturing Co., Ltd.'s advanced process technology, product performance, efficiency, and application performance have all steadily improved. Taking the Ryzen 9000 series released mid-year as an example, with no major adjustments in core specifications, it achieved a 16% increase in IPC through frequency increases and cache capacity increases, while still maintaining lower TDP power consumption compared to similar products from Intel Corporation. The Ryzen AI 300 series processors for mobile devices such as laptops and handheld devices have also received high attention, using the new Zen 5 architecture and integrating AMD XDNA 2 architecture.NPU, NPU computing power has exceeded that of Intel Corporation, reaching 50 TOPS.CPUCES5GWindowsSnapdragon 8cx Gen 3PC 5GPCARMPCPCPC CPU PC CPUIntel CorporationAMDARMPC CPUThe hat with weak chip performance. The released Snapdragon X Elite PC processor had a significant performance leap, surpassing similar products from Intel Corporation, AMD, and Apple Inc. Oryon CPU's performance exceeded that of its competitors at the time. Qualcomm CEO Amon continued to showcase third-party data, demonstrating Qualcomm's leading position in PC chips. NVIDIA Corporation2025ARMCPUPCAI PC NVIDIA CorporationPCARMx86The next attempt ended in failure.As early as 2011, Microsoft Corporation launched the Windows on ARM platform development program, collaborating with Qualcomm, NVIDIA Corporation, and Texas Instruments Incorporated to create a Windows RT version based on the ARM architecture. In 2012, Microsoft Corporation released the first Surface RT convertible laptop, which was powered by NVIDIA Corporation's Tegra3 processor, also the first quad-core processor by NVIDIA Corporation. However, this device was soon cleared out by Microsoft Corporation due to various defects such as incompatibility with x86 applications, high price, and system lagging. The subsequent product released in 2013, Surface RT2, once again featured NVIDIA Corporation's Tegra 4 processor, but the market response remained lukewarm. This failure led Microsoft Corporation to temporarily shelve its plans for ARM-based laptops. Subsequently, Microsoft Corporation commissioned Qualcomm to lead the porting of the Windows operating system to ARM architecture processors. As a result, Qualcomm obtained an exclusive agreement to develop Windows-compatible chips, but that's another story. Furthermore, NVIDIA Corporation's Tegra processors were once attempted in smartphones and other laptops, but due to poor heat dissipation performance and competition from Intel Corporation and AMD, Tegra did not make a big impact. In 2014, NVIDIA Corporation announced the launch of the "Denver project," planning to develop an ARM architecture CPU that integrates with NVIDIA Corporation's flagship GPU to provide processing power for PCs and other devices. However, this project eventually came to naught, and NVIDIA Corporation incorporated parts of the Denver project core into the Tegra processor. It is evident that at the time, Jen-Hsun Huang was very eager to enter the PC market. However, Tegra's numerous failures in mobile devices and consumer PCs were not successful. Although NVIDIA Corporation did not give up on the Tegra processor, it withdrew from the smartphone and consumer PC markets, shifting towards areas such as automotive platforms, gaming consoles, and embedded systems. Now, with the arrival of the AI era and increasing consumer demand for energy efficiency, it has created the perfect opportunity for NVIDIA Corporation, the AI powerhouse, to continue expanding its PC CPU business. After several failed attempts over the past decade, NVIDIA Corporation plans to re-enter the PC market next year, introducing a PC platform that integrates ARM architecture CPUs and their own GPUs to target consumer and commercial marketsthe consumer platform will be launched in September 2025, followed by the commercial platform in March 2026. This plan includes self-developed platforms and platforms designed in collaboration with MediaTek. NVIDIA Corporation's expertise and dominance in the AI server market and independent PC GPU market, coupled with its experience in Grace CPUs and Tegra application processors, give it a strong competitive advantage when entering the client PC market. On one hand, NVIDIA Corporation has unparalleled technological advantages in graphics processing. For gamers and graphic designers, powerful graphics processing capabilities are a key factor in chip selection. NVIDIA Corporation's GPU technology has long held a leading position in the industry, and when integrated with ARM architecture CPUs, it will undoubtedly create a superior graphics experience for users. On the other hand, NVIDIA Corporation's deep technical expertise in AI greatly enhances the competitiveness of its ARM processors. As AI technology becomes more prevalent in the consumer market, NVIDIA Corporation's processors can better execute AI tasks on PC devices, making them more competitive in intelligent and personalized experiences. Of course, gaming performance is NVIDIA Corporation's traditional strength. NVIDIA Corporation has a high market share in the gaming and graphics processing markets, with its GPUs being highly favored by gamers and content creators. With the introduction of PC processors, NVIDIA Corporation can leverage its strengths in gaming and graphics processing to provide more powerful hardware support for high-performance gaming PCs and professional graphics workstations. This integration allows NVIDIA Corporation to create more integrated gaming devices and enhance the experience for game developers and users. Currently, in the PC market, only Qualcomm and Apple Inc. have processors based on ARM architecture, with Apple Inc.'s M series chips only being used in Mac devices. Therefore, in the Windows PC field, Qualcomm is the only supplier. However, Apple Inc.'s move to switch from Intel Corporation processors to their own M series chips indicates that ARM architecture is also viable in the PC market, making it clear that Qualcomm alone cannot dominate and other companies also hope to participate. There are reports that, unlike Qualcomm and Apple Inc., NVIDIA Corporation may not develop custom cores for the processor but directly use ARM's existing cores. This strategy may lead to success in NVIDIA Corporation's automotive...There is a precedent in the automotive industry, with the Nvidia Drive platform using standard ARM Neoverse cores.Overall, although its attempt to acquire ARM ultimately failed, it did not deter NVIDIA Corporation's determination to enter the CPU market. Counterpoint believes that in the future, NVIDIA Corporation may use high-performance GPUs as a breakthrough, combined with ARM-based SoCs, to further expand its ambitions in the AI and PC fields. However, compatibility is also a major challenge for NVIDIA Corporation. Although the Qualcomm Snapdragon X Elite processor and Apple Inc. M processor have demonstrated the huge potential of ARM CPUs for gaming, currently most PCs and games do not natively support Windows ARM. If NVIDIA Corporation wants to demonstrate its powerful gaming performance on PC processors, it needs to invest a lot of resources in porting the gaming ecosystem to the ARM ecosystem. MediaTek: Advancing into PC CPUs After establishing a foothold in the mobile chip market, MediaTek is also rumored to be looking to enter the AI PC market. Although the news of MediaTek collaborating with NVIDIA Corporation to develop PC AI processors has not been officially confirmed, MediaTek's Kompanio 838 chip showcased its potential in the AI PC chip field at the 2024 Taipei International Computer Show. Additionally, MediaTek announced its participation in ARM's comprehensive design ecosystem project, further demonstrating its deep commitment to this field. Multiple reports indicate that NVIDIA Corporation and MediaTek may be developing new ARM architecture chips for PCs. Currently, both companies have designed ARM architecture CPUs for other fields, with NVIDIA Corporation focusing on servers and edge computing devices, while MediaTek focuses on Chromebooks, smartphones, and smart devices. If MediaTek is able to successfully bring its strengths in the mobile field, such as efficient chip design and good energy control, into the PC market, combined with NVIDIA Corporation's technical support, they may form a new competitive force in the PC market. Its ability to integrate resources and optimize costs may also bring new product ideas and pricing strategies to the PC market, prompting other giants to make corresponding adjustments in product layout and pricing. In recent years, the two companies have closely cooperated in many product areas mainly due to the complementarity of NVIDIA Corporation's GPUs and MediaTek's SoCs. Their collaborative products include automotive cockpits, edge computing, the Internet of Things, and smart TVs. MediaTek is actively expanding into the laptop processor market, having launched processors such as the MT8195, MT8192, Kompanio 838 in recent years, but these SoCs are mainly aimed at Chromebook devices and have not yet truly entered the consumer laptop market. Last year, NVIDIA Corporation and MediaTek announced a partnership to develop high-performance platforms for Chromebooks. The collaboration aims to combine NVIDIA Corporation's GPU technology with MediaTek's processors to provide Chromebooks with stronger graphics and AI processing capabilities. This collaboration is also the result of rumors about NVIDIA Corporation's re-entry into the PC CPU market. During the Computex event in Taipei in June 2024, Huang Renxun personally attended MediaTek's keynote speech, emphasizing that NVIDIA Corporation will cooperate with MediaTek in cloud and device services in the future, thus verifying speculations about their joint entry into the consumer PC market. Of course, the timing of NVIDIA Corporation and MediaTek's entry into the PC CPU market is also interesting. This coincides with the expected end of Qualcomm's exclusive agreement for Windows on ARM devices, meaning that the doors for new players have opened, and competition in the ARM-based Windows PC field may intensify. Meanwhile, ARM's legal disputes with Qualcomm have provided an appropriate opportunity for other competitors. With NVIDIA Corporation and MediaTek entering the PC market this year, the PC CPU market is set to become more crowded, posing a significant challenge to traditional PC processor giants like Intel Corporation. x86 VS ARM, Who Will Prevail? With Apple Inc. fully transitioning to self-developed chips and the entry of chip manufacturers such as Qualcomm, NVIDIA Corporation, and MediaTek, the market growth of PC processors based on ARM architecture is accelerating. Research firm TechInsights predicts that by 2025, the share of laptops equipped with ARM architecture CPUs will reach 20%, and it is expected to exceed 40% by 2029. ARM poses a threat to x86's long-standing dominance in the laptop market. The CEO of ARM even boldly claims that within the next five years, ARM architecture chips will have a market share of over 50% in the Windows PC market, adding a degree of certainty to the upcoming AI PC revolution. It can be seen that the PC market is gradually moving towards a new era of confrontation between ARM and x86. In recent years, Apple Inc. has fully replaced Intel Corporation processors with its self-developed ARM M-series chips in the Mac product line, demonstrating to many manufacturers that ARM architecture chips can achieve high performance in addition to low power consumption. Another giant, Qualcomm, has also introduced ARM architecture-based PC processors, making a leap in CPU performance and overshadowing Intel Corp in terms of performance."Oration and AMD flagship"ARM is eager to see more giant manufacturers enter the PC market. Compared to the lawsuit against Qualcomm, NVIDIA Corporation and MediaTek, as ARM's closest partners, have already cooperated in many other chip areas and are now beginning to challenge PC CPUs. If ARM's push is successful, the market will once again face a "reshuffle". For processor manufacturers such as Qualcomm, NVIDIA Corporation, and MediaTek that have deep roots in the ARM architecture field for many years, this is a huge opportunity. However, ARM processors still face significant obstacles in challenging Intel Corporation and AMD's x86 camp in the Windows PC market. Currently, although Windows on ARM supports emulation of x86 and x64 applications, the efficiency and compatibility of emulation are still not as good as native applications, especially in complex productivity and professional application scenarios. Moreover, mainstream software vendors lack enthusiasm for adapting to the ARM platform, and many key software applications have not yet been released in native versions, limiting the user experience. Furthermore, compatibility issues in the gaming sector further restrict the appeal of ARM PCs. Many enterprise applications have limited support for the ARM platform, and enterprise users have high requirements for software compatibility and stability, making adaptation costs a major obstacle. The completeness of the developer toolchain is another limiting factor. Although Microsoft Corporation provides some support for ARM developers, the development environment and resources for the ARM platform still need further optimization compared to the x86 platform. If companies like Qualcomm want to promote the widespread adoption of ARM PCs, they need to closely cooperate with Microsoft Corporation and developers to encourage more native application adaptations, while also improving emulation performance to address the ecosystem's shortcomings. Providing a smooth user experience for Windows on ARM devices, even with macOS, which offers a rich application ecosystem for users, the current situation is not optimistic. IDC statistics show a 24.2% year-on-year drop in Apple Inc. Mac shipments in the third quarter of this year. In addition to the range of hardware suppliers, the software ecosystem remains one of the most important issues related to ARM PCs. Overall, although Windows on ARM has matured technically, the software ecosystem's shortcomings remain its biggest obstacle to promotion. Only through multi-party cooperation can ARM PCs truly challenge the current dominance of the x86 market through dual improvements in software ecosystem and hardware performance. Moreover, Intel and AMD are not sitting idly by. In mid-October, AMD and Intel Corporation announced a joint establishment of an x86 ecosystem advisory group. The organization members also include Microsoft Corporation, Alphabet Inc. Class C, Meta, Lenovo, Dell Technologies, Inc. Class C, and other hardware and software manufacturers participating in the x86 ecosystem. According to official statements, the organization focuses on exploring new ways to expand the x86 ecosystem by achieving cross-platform compatibility, simplifying software development, and providing a platform for developers to identify architecture requirements and features. In short, the goal of this group is to collaborate to improve the x86 ISA, promote unity in the x86 camp, enhance compatibility, and simplify the software development process. It is likely to counter the threat of ARM, strengthen its own competitiveness, and shed some of the burdens accumulated by the x86 architecture. Historically, there have been very few instances of cooperation between Intel Corporation and AMD on x86. It can be said that in the past few decades, apart from early technology licensing, the two companies have mostly been in a competitive state. As the ARM camp becomes stronger, the alliance between AMD and Intel Corporation actually implies that the x86 camp will face challenges from the ARM camp in the future. In conclusion, with the gradual resolution of ARM's ecosystem issues and the accelerated improvement of chip performance, the strength of the ARM architecture in the PC chip domain in the future should not be underestimated. With the support of veterans such as Apple Inc., Qualcomm, NVIDIA Corporation, and MediaTek, the ARM architecture camp will gradually erode the traditional territory of the x86 architecture. The PC processor market is about to see significant changes.