You know when you spill your drink but keep on dancing anyway? That's totally Intel right now Intel's latest financial report shows profits hit by the downturn in the personal computer market, but Chipzilla's growing presence in the cloud is helping make up some of the shortfall. In the third quarter of 2015, the computer processor giant generated revenues of US$14.5bn and a net income of US$3.1bn – six per cent less …
"Intel's going to be very strong in the data center market for at least a couple of years,"
If your plan seems to rely on momentum after the boilers have gone cold then you're dead - you just don't realise it yet.
Wall St demands growth. That's where stock value comes from. No growth, or just stasis, and they'll butcher you at the next shareholders' meeting.
Two aspects of it:
1) These expectations come from investors, who only invest because they expect to get more back than they could get elsewhere (for the same degree of safety). This return generally comes from growth of some sort, quite possibly at the expense of rivals (when the market is somewhat zero-sum), but the investors don't care at all that other investors are losing the bet to them. In this context they certainly don't care about the long-term global economy (nor do they care that the heat death of the universe ultimately makes the concept of money farcical. Do you?)
2) Growth of value isn't directly connected to growth of resource consumption - ultimately the world or at least the attainable parts of the universe may be a resource constraint upon us. For example the growth of global food production wasn't achieved by linearly increasing the area of land used or the man-power involved.
Intel has extremely good process technology. Also if you need to run any legacy software on a server, then an ARM server isn't going to be the answer.
I expect Intel will be king of the server room for a lot more than two years. Also, that should the ARM architecture start making serious inroads, then it'll be Intel fabbing the best of them.
Meanwhile, Intel is one of the major players in the developing nonvolatile-RAM space.
Tough trading, maybe, but it doesn't look anything like a failing company to me.
And where are sales of tablets going?
Everyone who needs a PC has a PC. Need is mostly business desktops and people doing serious work at home.
Everyone who needs a tablet has a tablet. Fewer people than the hypesters once imagined. Mostly home users. A tablet is a data-consumption device not a data-creation device.
The biggest growth market has been the smartphone, but soon everyone who needs one will have one, and it's only Apple who can get away with charging twice as much for a phone designed to last half as long. (OK I exaggerate).
In short, we're in transition from a first-purchase and obsolescence-driven market, to a mature, replacement-driven market. Which is why the big news will be in servers and nonvolatile RAM.
Quite expected if you paid attention. Intel had a "contra revenue" program where OEMs paid full price for their tablet SoCs, and then Intel refunded them MORE than what they paid as a kickback. As one wag said, basically they're giving away their tablet SoCs wrapped in dollar bills. They didn't do this for the 'real' x86 CPUs used in Surface Pro, only for the SoCs designed specifically for the true tablet market.
Obviously when you slow or stop that program, companies that were buying x86 SoCs for tablets (other than Surface Pro, which is really a laptop in disguise) because they were 'free' went back to ARM SoCs. Thus the large drop in tablet revenue, even with Surface Pro sales staying constant or even increasing.
The boilers haven't gone cold, we're at the start of the server refresh cycle following the global financial crisis. IT has only just had budget increased in many instances which means Intel is about to have a record few years in the server market. Not to mention Amazon and Microsoft buying every chip they can lay their hands on for the next few years.
Who thinks that by the looks of articles like these, big IT firms do not make any money unless they have double digits growth year after year, and they are all to exit the market one good day from now?
For fcuk sake!, Intel is almost a monopoly in some of their market segments, create something decent people may actually want and quit whining.
Exactly. Not a good trend, but not quite in a bad shape! "declining revenues" != "actual losses", and given the amount of net revenues and liquidity they have, this is not quite a sad day.
The market has gone seriously saturated. With a Pentium, you had a good reason to ditch that 386. With a Pentium III, you had a good reason to ditch that Pentium. With a dual/quad-core, you had an excellent reason to ditch that Pentium III. Now, still no end in sight for that machine I bought in 2009.
Just like the 56k modem businesses and countless others had to find something more exciting, a similar thing might apply to that x86 fella.
In my experience "Market Makers" may be only minimally informed as to the nature of the companies in which they invest and their products/prospects.
Back in the days when Sinclair and Acorn were struggling and Amstrad were taking off big-time, the Amstrad stock price fell back, "Because it was a computer stock too", according to our broker, who questioned our decision to bet the farm on Alan Sugar and Amstrad.
That assessment was so obviously disconnected from the true market prospects that we did the deed promptly at a slightly lower price than expected - 67p per share, iirc.
We rode that bet all the way to the top, which made a massive difference to our family finances.
Suspect it's not that different today, although I do still try to explain tech stuff to people.
For some reason their faces usually glaze over in bewilderment, then the snoring starts.
I blame the parents, of course.
;)
I guess this is what happens when you don't listen to your customers and release 4 generations of CPUs that aren't significantly faster than the previous one. Devoting 60% plus of the die to graphics that are still worthless is not a great strategy. Most people would be happy with 1/4 of that for the GPU and everyone else buys a discrete GPU anyway.
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