March 18, 2009

An $800 processor at half price

Converge CPU Update

Intel’s dramatic drop in profits for Q4 2008, combined with the closing of several factories, cast a cloud of doubt over the CPU market at the beginning of the year. However, the market remains calm, as an anticipated glut of excess inventory resulting from the recession has not emerged. Microprocessor prices remain firm while February and March have seen a gradual easing of traditional production demand.

Overall, pricing of the popular TJ OEM model CPUs (T2390, T3200, T5800, T6400, etc.) has not receded, while midrange desktop CPU models E2220 and E5200 are trading at, or slightly below, direct pricing.

While demand remains moderate, our tracking indicates that customer requirements are moving from low-end Celerons and high-end Montevinas toward midrange CPUs. Converge believes that this trend is why pricing remains steady – with demand congregated around 10 SKUs on mobile and desktop units.

Elsewhere the situation remains more volatile.

High end sees hard times
The X8100 processor is a high-end CPU that would make even the biggest “techie” jealous. It is a Core2 Extreme edition mobile processor and, at $800+ direct, priced above most complete laptops. Similarly, the Santa Rosa T9500 is a high-end processor currently priced at $525 direct. Both are currently available in the spot market as OEM excess at roughly half price. Now is the time to procure these processors for big savings.

For desktops, the older QXXXX models are once again trading below direct pricing by as much as 20%.

Embedded products revive demand
The proliferation of embedded products has revived the demand for older processors. For example, the Celeron M 300 series of microprocessors, which had their production heyday in 2004, sold for $30-$50 per unit. Today, as an embedded product, direct prices for the same product are usually above $60.

OEMs with excess inventory of older low-voltage Celerons, NAPA T7200 or T7400, for example, can find sales opportunities in the spot market. Contact Converge to learn more.

Share this blog post:

No comments:

Post a Comment