According to a recent Jon Peddie Research report, Intel increased its graphics chip market share to 55.2% driven by strong Atom sales while Nvidia’s share declined to 24.3% and AMD’s share declined slightly to 19.9%. Let’s take a closer look.

The quarterly research report included the first shipments of a new category, the CPU-integrated graphics – CIG and predicts that there would be a rapid decline in shipments of traditional integrated graphics processors (IGPs). AMD gained share in the notebook IGP segment, but lost share in both the desktop and notebook GPU segments due to constraints in 40nm supply. NVIDIA gained some share in desktop discretes, while slipping in desktop and notebook IGP. This downward trend will likely continue as Nvidia’s focus shifts to tablets and cell phones with its new Tegra chip.

In the higher-end advanced graphics card market where Nvidia dominates, Intel had earlier planned to compete with an advanced graphic card, Larrabee. However, Intel recently scrapped its plans for a commercial launch and said that it would instead use it as a software development platform for graphic and high-performance computing.

Nvidia last week reported fiscal year 2010 revenue of $3.3 billion, down about 3% and net loss of $68 million. As the market rebounded, fourth quarter revenue grew 9% q-o-q and doubled from last year and it swung to a profit of $131.1 million from a loss of $147.7 million last year. It ended the quarter with $1.73 billion in cash.

Read the entire article in Sramanamitra.