Intel Corporation (NASDAQ:INTC) is absolutely dominating its core market. The only problem is that those markets are slowly dying. The company’s desktop, notebook and server businesses are doing as well as, or better, than ever, but the company needs to go mobile in order to continue growth in the coming years.

Intel

A new report from Mercury Research goes into the third quarter processor market in detail. Intel Corporation (NASDAQ:INTC) accounted for 83.3% of the total market, excluding mobile and games consoles. The numbers show the way the company has managed to completely dominate the traditional processor market, as Advance Micro Devices Inc. (NYSE:AMD) slumped through the last decade.

Processor market share at Intel

Intel Corporation (NASDAQ:INTC) accounted for about 96.6%, up 160 basis points from Q2, of the server market in the third quarter of the year. The firm held 85.6% of the notebook market in the same period, up 170 basis points sequentially. The only part of the traditional market that Intel lost out in during the third quarter was full desktops, where Advance Micro Devices, Inc. (NYSE:AMD) gained.

Intel Corporation (NASDAQ:INTC) lost out on getting its processors into the next generation of games consoles, but that’s not where the company is concentrating its efforts. The processor manufacturer has been trying to get into the mobile market, with an emphasis on the tablet market.

Intel is making headway with its latest mobile processors, which are codenamed Bay Trail. The first tablets running the new processors will go on sale this Christmas. Dell Inc. (NASDAQ:DELL) was the first company to launch a tablet running the new processors.

Intel inexorable decline

The processor market has been dominated by Intel Corporation (NASDAQ:INTC), but the firm is not performing well. The Mercury report contained no information about the average selling prices in the processor market, but sources, including Intel’s own earnings report, indicate that selling prices and margins are falling in the industry.

Intel Corporation (NASDAQ:INTC) needs new business, and the transition will not be easy. Selling prices and margins are lower in the mobile processor market. Shares in Intel are up more than 16% for the year so far, indicating the market thinks that the company can make the change. Domination of a dying market isn’t a healthy business model. Intel will have to show the market it can change to justify its share price.