Chip maker AMD continues to gain market share from dominant processor supplier Intel.

AMD announced record sales of its Opteron processor as part of its first-quarter financial results last week.

Many experts say AMD has a technological lead over its rival, demonstrated by releasing 64-bit products and dual-core chips ahead of Intel.

‘We believe we once again gained market share based on strong customer demand for AMD64 single and multi-core processors,’ said AMD’s chief financial officer Robert Rivet.

‘We expanded our global customer base in the quarter, achieved record Opteron processor sales, increased our average selling price, and realised year-over-year sales growth of 71 per cent.’

Last month, Intel warned that its first-quarter sales would be below expectations because of weaker-than-expected demand and a drop in market share. But its latest quarterly revenue outstrips AMD by more than six times.

PC analyst Mercury Research estimates that Intel lost about five percentage points of market share to AMD during 2005.

Forrester Research vice president Richard Fichera says AMD gained early ground in supplying chips for servers, but that Intel is fighting back.

‘AMD’s initial success in the server market was heady indeed, but progress will probably slow because of Intel’s actual product deliveries and its aggressive messaging to prospective AMD converts,’ he said.