AMD saw another quarter of outstanding growth in sales of its server chips, giving the company its highest single-quarter gain for server CPUs since 2006 and eating into Intel\u2019s most valuable market segment, according to the latest market report from Mercury Research.\nWe\u2019ll get to the desktop segment later, but AMD\u2019s server CPU share grew 1.8 percentage points from Q4 2020 to Q1 2021, from 7.1% to 8.9%. That is astonishing as server numbers just don\u2019t move like that so quickly. In the same single-quarter period, Intel slipped 1.8 percentage points, from 92.9% to 91.1%.\n\nThere is seasonality in the server market, where it is normal for sales to go down in Q1, Dean McCarron, president of Mercury Research, told me. Cloud-server companies like AWS and Google go through a build\/burn cycle where they buy a lot, then take time to deploy it all. Right now we are at the very bottom of build cycle where they buy the least amount, so if they are putting up these kinds of numbers during a low point, it will be even better when they start buying again.\nLast month AMD reported fantastic Q1 revenues of $3.45 billion, up 93% from the same quarter in 2020. The company expects revenue for Q2 FY 2021 of roughly $3.6 billion, up about 86% year-over-year.\nThe irony is that AMD unit sales are actually down thanks to the supply shortage we\u2019ve all heard about. AMD is making up for it by selling more high-end parts, both client and server, than low-end.\nIntel has been ramping Celeron PC processors for some time, McCarron said. It had a big problem supplying chips for more than 18 months, but eventually it caught up with demand. Then Apple dumped Intel and decided to go with its home-grown Arm processor for Mac, freeing up even more Intel capacity.\nThat\u2019s a bad one-two punch for Intel, selling low-end Celerons while Xeons that sell for 10 times the price are slipping.\nFor the first quarter of 2021, processor shipments were just slightly lower than the fourth quarter of 2020, which is typical, coming off the Christmas rush. However, with continued work and schooling from home, PC sales continue to explode.\nFirst quarter 2021 shipments of PC CPUs were the second-highest volume in history\u2014second only to the previous quarter. Compared to the first quarter of 2020, total shipments were\u00a0 up 41%, the highest on-year growth seen in PC processor shipments since 1996, says McCarron in a research note. All told, AMD has continued to gain market share for 16 of the last 17 quarters.