Close Menu
TechCentralTechCentral

    Subscribe to the newsletter

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

    Facebook X (Twitter) YouTube LinkedIn
    WhatsApp Facebook X (Twitter) LinkedIn YouTube
    TechCentralTechCentral
    • News

      Blue Label Telecoms to change its name as restructuring gathers pace

      11 July 2025

      Get your ID delivered like pizza – home affairs’ latest digital shake-up

      11 July 2025

      EFF vows to stop Starlink from launching in South Africa

      11 July 2025

      Apple plans product blitz to reignite growth

      11 July 2025

      Nissan doubles down on South Africa despite plant uncertainty

      11 July 2025
    • World

      Grok 4 arrives with bold claims and fresh controversy

      10 July 2025

      Bitcoin pushes higher into record territory

      10 July 2025

      Cupertino vs Brussels: Apple challenges Big Tech crackdown

      7 July 2025

      Grammarly acquires e-mail start-up Superhuman

      1 July 2025

      Apple considers ditching its own AI in Siri overhaul

      1 July 2025
    • In-depth

      Siemens is battling Big Tech for AI supremacy in factories

      24 June 2025

      The algorithm will sing now: why musicians should be worried about AI

      20 June 2025

      Meta bets $72-billion on AI – and investors love it

      17 June 2025

      MultiChoice may unbundle SuperSport from DStv

      12 June 2025

      Grok promised bias-free chat. Then came the edits

      2 June 2025
    • TCS

      TCS+ | MVNX on the opportunities in South Africa’s booming MVNO market

      11 July 2025

      TCS | Connecting Saffas – Renier Lombard on The Lekker Network

      7 July 2025

      TechCentral Nexus S0E4: Takealot’s big Post Office jobs plan

      4 July 2025

      TCS | Tech, townships and tenacity: Spar’s plan to win with Spar2U

      3 July 2025

      TCS+ | First Distribution on the latest and greatest cloud technologies

      27 June 2025
    • Opinion

      In defence of equity alternatives for BEE

      30 June 2025

      E-commerce in ICT distribution: enabler or disruptor?

      30 June 2025

      South Africa pioneered drone laws a decade ago – now it must catch up

      17 June 2025

      AI and the future of ICT distribution

      16 June 2025

      Singapore soared – why can’t we? Lessons South Africa refuses to learn

      13 June 2025
    • Company Hubs
      • Africa Data Centres
      • AfriGIS
      • Altron Digital Business
      • Altron Document Solutions
      • Altron Group
      • Arctic Wolf
      • AvertITD
      • Braintree
      • CallMiner
      • CambriLearn
      • CYBER1 Solutions
      • Digicloud Africa
      • Digimune
      • Domains.co.za
      • ESET
      • Euphoria Telecom
      • Incredible Business
      • iONLINE
      • Iris Network Systems
      • LSD Open
      • NEC XON
      • Network Platforms
      • Next DLP
      • Ovations
      • Paracon
      • Paratus
      • Q-KON
      • SevenC
      • SkyWire
      • Solid8 Technologies
      • Telit Cinterion
      • Tenable
      • Vertiv
      • Videri Digital
      • Wipro
      • Workday
    • Sections
      • AI and machine learning
      • Banking
      • Broadcasting and Media
      • Cloud services
      • Contact centres and CX
      • Cryptocurrencies
      • Education and skills
      • Electronics and hardware
      • Energy and sustainability
      • Enterprise software
      • Fintech
      • Information security
      • Internet and connectivity
      • Internet of Things
      • Investment
      • IT services
      • Lifestyle
      • Motoring
      • Public sector
      • Retail and e-commerce
      • Science
      • SMEs and start-ups
      • Social media
      • Talent and leadership
      • Telecoms
    • Events
    • Advertise
    TechCentralTechCentral
    Home » Electronics and hardware » Intel’s still dancing as the chip party dies

    Intel’s still dancing as the chip party dies

    By Agency Staff26 October 2018
    Twitter LinkedIn Facebook WhatsApp Email Telegram Copy Link
    News Alerts
    WhatsApp

    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
    Subscribe to TechCentral Subscribe to TechCentral
    Share. Facebook Twitter LinkedIn WhatsApp Telegram Email Copy Link
    Previous ArticleWhat to expect in the Samsung Galaxy S10
    Next Article Digital migration delay of ‘grave concern’: Mokonyane

    Related Posts

    TechCentral Nexus S0E4: Takealot’s big Post Office jobs plan

    4 July 2025

    Tan eyes 14A pivot as Intel rethinks foundry future

    2 July 2025

    Computex 2025 – key takeaways from Asia’s biggest AI tech show

    23 May 2025
    Company News

    $125-trillion traded: Binance redefines global finance in just eight years

    11 July 2025

    NEC XON welcomes HPE acquisition of Juniper Networks

    11 July 2025

    LTE Cat 1 vs Cat 1 bis – what’s the difference?

    11 July 2025
    Opinion

    In defence of equity alternatives for BEE

    30 June 2025

    E-commerce in ICT distribution: enabler or disruptor?

    30 June 2025

    South Africa pioneered drone laws a decade ago – now it must catch up

    17 June 2025

    Subscribe to Updates

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

    © 2009 - 2025 NewsCentral Media

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