When one seems to be on the well being of the semiconductor trade, the names Samsung and Intel are normally the businesses most scrutinized. Each corporations have lengthy been the highest two semiconductor suppliers, as ranked by market analysts. For a number of years, Intel has reeled below the load of falling gross sales and earnings, introduced on largely by a weakened marketplace for PCs and servers submit COVID. There’s proof, although, the corporate is popping it round after a string of dismal quarters.
In its third quarter, Intel posted GAAP earnings of seven cents per share on gross sales of $14.2 billion. Whereas the income was nonetheless down 8% year-over-year, it exceeding the excessive finish of Intel’s projected quarterly steerage. This marked the second consecutive quarter that Intel has posted a revenue. The outcomes point out that the varied strikes made by the corporate over the previous yr to manage prices and restructure its enterprise, together with shedding a part of its workforce and consolidating some manufacturing amenities, are beginning to present constructive outcomes.
Driving the AI Wave
The associated fee-cutting strikes, together with improved market circumstances, have appeared to stabilize Intel’s enterprise. However the important thing to Intel regaining its market momentum would be the firm shifting its enterprise away from PCs and servers to high-end computing and AI, the place the stakes might be excessive as generative AI and machine studying are creating an insatiable urge for food for brand spanking new high-speed processors. Right here, Intel is prone to face stiff challenges from Nvidia, which has gotten a leg up on different semiconductor suppliers with its GPUs and different processors for AI functions, in addition to archrival AMD.
Judging from Intel’s current bulletins, the corporate goes all-in on this sector, investing hundreds of thousands to develop next-generation processors. The corporate continues to ramp up its 4th Gen Intel® Xeon® Scalable processor, with the world’s top-10 cloud service suppliers now deploying it normally availability. As well as, the corporate’s fifth Gen Intel® Xeon® processor, code-named Emerald Rapids, is in manufacturing and has begun transport to prospects. Intel’s Gaudi®2 accelerators, whose aggressive efficiency was not too long ago validated by MLCommons benchmarking outcomes, are additionally gaining momentum with prospects. Along with Stability AI, Intel is constructing one of many world’s largest AI supercomputers solely on 4th Gen Intel Xeon Scalable processors and 4,000 Intel Gaudi2 AI accelerators.
Intel has additionally launched the newest OpenVINO™ toolkit model 2023.1 for builders engaged on AI inferencing and deployment on consumer and edge platforms.
Throughout Intel’s Fall Developer occasion, CEO Pat Gelsinger spoke about PC enjoying a key function within the improvement of AI. To this finish, the corporate is banking on its Intel® Core™ Extremely processors, code-named Meteor Lake. Constructed on Intel 4, the Intel Core Extremely processor started transport to prospects within the third quarter and can formally launch Dec. 14, together with the fifth Gen Intel Xeon processor. Intel additionally not too long ago launched the brand new Intel® Core® 14th Technology desktop processor household, delivering quick desktop frequencies for fanatics.
As a result of intel’s chip improvement efforts require newer fabrication processes, the corporate additionally continues to switch its manufacturing footprint, benefiting from incentives out there from the CHIPS Act handed over a yr in the past. With a watch in the direction of onshoring extra manufacturing and R&D, Intel now has plans to construct or increase manufacturing vegetation in Arizona, New Mexico, Ohio, and Oregon.
Streamlining Operations
Intel’s all-in technique on capturing high-end computing markets has additionally prompted the corporate to make a number of strategic choices on peripheral enterprise operations. Final month, Intel introduced it will spin off its Programmable Options Group (PSG) operations right into a standalone enterprise. In line with Intel, this may give PSG the autonomy and adaptability it wants to totally speed up its development and extra successfully compete within the FPGA trade. Intel is in search of to conduct an IPO for PSG.
Spencer Chin is a Senior Editor for Design Information overlaying the electronics beat. He has a few years of expertise overlaying developments in elements, semiconductors, subsystems, energy, and different sides of electronics from each a enterprise/supply-chain and know-how perspective. He may be reached at [email protected].
