TechCentralTechCentral
    Facebook Twitter YouTube LinkedIn
    Facebook Twitter LinkedIn YouTube
    TechCentral TechCentral
    NEWSLETTER
    • News

      Saboteurs threaten South Africa’s power supply

      20 May 2022

      Prosus to sell Russia’s Avito

      20 May 2022

      Curro pilots artificial intelligence for learning in its schools

      20 May 2022

      Dark weekend lies ahead thanks to you know who

      20 May 2022

      CSIR develops app to help kids learn to read

      20 May 2022
    • World

      Chip giant ASML places big bets on a tiny future

      20 May 2022

      Musk moves to soothe investor fears over Tesla

      20 May 2022

      Apple is almost ready to show off its mixed-reality headset

      20 May 2022

      TikTok plans big push into gaming

      19 May 2022

      Musk says he will vote Republican, calls ESG a ‘scam’

      19 May 2022
    • In-depth

      Elon Musk is becoming like Henry Ford – and that’s not a good thing

      17 May 2022

      Stablecoins wend wobbly way into the unknown

      17 May 2022

      The standard model of particle physics may be broken

      11 May 2022

      Meet Jared Birchall, Elon Musk’s personal ‘fixer’

      6 May 2022

      Twitter takeover was brash and fast, with Musk calling the shots

      26 April 2022
    • Podcasts

      Dean Broadley on why product design at Yoco is an evolving art

      18 May 2022

      Everything PC S01E02 – ‘AMD: Ryzen from the dead – part 2’

      17 May 2022

      Everything PC S01E01 – ‘AMD: Ryzen from the dead – part 1’

      10 May 2022

      Llew Claasen on how exchange controls are harming SA tech start-ups

      2 May 2022

      The inside scoop on OVEX’s big expansion plans

      20 April 2022
    • Opinion

      A proposed solution to crypto’s stablecoin problem

      19 May 2022

      From spectrum to roads, why fixing SA’s problems is an uphill battle

      19 April 2022

      How AI is being deployed in the fight against cybercriminals

      8 April 2022

      Cash is still king … but not for much longer

      31 March 2022

      Icasa on the role of TV white spaces and dynamic spectrum access

      31 March 2022
    • Company Hubs
      • 1-grid
      • Altron Document Solutions
      • Amplitude
      • Atvance Intellect
      • Axiz
      • BOATech
      • CallMiner
      • Digital Generation
      • E4
      • ESET
      • Euphoria Telecom
      • IBM
      • Kyocera Document Solutions
      • Microsoft
      • Nutanix
      • One Trust
      • Pinnacle
      • Skybox Security
      • SkyWire
      • Tarsus on Demand
      • Videri Digital
      • Zendesk
    • Sections
      • Banking
      • Broadcasting and Media
      • Cloud computing
      • Consumer electronics
      • Cryptocurrencies
      • Education and skills
      • Energy
      • Fintech
      • Information security
      • Internet and connectivity
      • Internet of Things
      • Investment
      • IT services
      • Motoring and transport
      • Public sector
      • Science
      • Social media
      • Talent and leadership
      • Telecoms
    • Advertise
    TechCentralTechCentral
    Home»Sections»Consumer electronics»Intel’s still dancing as the chip party dies

    Intel’s still dancing as the chip party dies

    Consumer electronics By Agency Staff26 October 2018
    Facebook Twitter LinkedIn WhatsApp Telegram Email

    About the closest Intel got to recognising concerns around the state of the chip sector was to note how it’ll be difficult to keep the momentum going in 2019:

    This has been a fantastic year for us, I think for the industry, and you know that just makes comps a little bit tougher as we go into next year.

    That’s chief financial officer Bob Swan answering a question about possible headwinds for the company given the trade war between the US and China. It’s almost as though Swan, who’s also interim CEO, wasn’t even aware of the cacophony outside Intel’s Santa Clara headquarters.

    And, frankly, why would he be?

    Not only did Intel’s sales and earnings per share beat estimates, Swan raised the company’s full-year guidance. Intel is also planning to spend around US$1.5-billion more on capex this year than it originally expected. Its budget for equipment to make logic chips — the stuff that’s not memory — will rise even further next year, he said.

    A 15% jump in shipments of desktop PC chips from the prior quarter, and a 12% increase for notebooks, drove the division to record sales

    Meanwhile, shareholders of AMD and Texas Instruments are 23% and 8% poorer respectively in the last two days after both companies delivered bad news. Taiwan Semiconductor Manufacturing kicked off a gloomy earnings season last week when it blamed continued cryptocurrency weakness and excess inventories for a disappointing outlook and a third cut in its full-year guidance.

    Then in waltzes Intel fiddling an upbeat tune.

    Either it’s somehow immune to the macro meltdown affecting not just chips but multiple areas of the global economy, or the dark clouds just haven’t appeared on its horizon yet.

    It’s likely the latter.

    Not easily replicated

    Intel deserves the accolades its management, and its share price, will get from turning in a great set of numbers. But a lot of this is accidental or not easily replicated.

    The company itself conceded that third-quarter numbers were juiced by surprising demand for PCs, a slice of the tech industry that’s been a laggard for the past decade. Despite pivoting strongly toward the development of chips used in server farms and communications equipment, its client computing group still accounts for more than half of sales. A 15% jump in shipments of desktop PC chips from the prior quarter, and a 12% increase for notebooks, drove the division to record sales.

    That strength will continue this quarter, though Intel said this will constrain its ability to meet demand as the chip maker prioritises higher-value products used in data centres.

    Which is where Intel’s landmines may lie next year.

    The world’s obsession with streaming TV shows, playing online games and uploading selfies has been a boon to swathes of the tech industry. That enthusiasm for content won’t die anytime soon. But as the hardware side of the equation matures it’s going to get more competitive.

    Caught off guard by a slowdown in demand for graphic chips and the crypto industry, AMD is on the cusp of beating Intel to the latest production technologies. That’s because it made the decision earlier this year to switch manufacturing to TSMC, which is leading the world in production of chips at 10 nanometres and the more advanced 7-nanometre nodes. (Apple’s latest iPhone has chips made at 7nm — Intel doesn’t expect to ship 10nm until next year.)

    Beyond AMD, Intel faces the risk that its clients are considering building their own chips. It never really made sense for PC brands like HP, Dell or Lenovo to go it alone on semiconductors because the unit cost of end devices is low and those products are quite varied. When you buy servers by the truckload for thousands of bucks each, then designing your own components seems like a wise move.

    It’s worth noting that the cloud giants aren’t invincible either, which makes any sales to them far from a sure bet. Both Amazon.com and Alphabet turned in disappointing numbers this week.

    Then there are the macro headwinds that Swan avoided discussing, and to which even mighty Intel isn’t immune. The world’s biggest chip company may well be better positioned than its rivals to handle any global slowdown, but when the hurricane comes everyone has to batten down the hatches.

    Until then, Intel and its shareholders should bathe in the glorious sunshine. While it lasts.  — Reported by Tim Culpan, (c) 2018 Bloomberg LP

    AMD Bob Swan Intel top
    Share. Facebook Twitter LinkedIn WhatsApp Telegram Email
    Previous ArticleWhat to expect in the Samsung Galaxy S10
    Next Article Digital migration delay of ‘grave concern’: Mokonyane

    Related Posts

    Saboteurs threaten South Africa’s power supply

    20 May 2022

    Prosus to sell Russia’s Avito

    20 May 2022

    Curro pilots artificial intelligence for learning in its schools

    20 May 2022
    Add A Comment

    Comments are closed.

    Promoted

    Fast-rising fintech Bankingly closes $11m investment round

    20 May 2022

    Creating an effective employer value proposition for the new era of work

    20 May 2022

    Why fibre is the new utility – and what it means for South Africa

    19 May 2022
    Opinion

    A proposed solution to crypto’s stablecoin problem

    19 May 2022

    From spectrum to roads, why fixing SA’s problems is an uphill battle

    19 April 2022

    How AI is being deployed in the fight against cybercriminals

    8 April 2022

    Subscribe to Updates

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    © 2009 - 2022 NewsCentral Media

    Type above and press Enter to search. Press Esc to cancel.