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Intel IDF Report Day 2 And The Outlook For 2014 Earnings

Michael Blair profile picture
Michael Blair
6.07K Followers

Intel (NASDAQ:INTC) did not stop making itself felt at the International Developers' Forum (IDF) in San Francisco when it announced that it was shipping 22nm Silvermont processors already, would be shipping 14nm processors by year-end and had a clear path to 10 nm and 7nm processes targeted for 2015 and 2017, respectively. These are dramatic advances compared to the 90 nm process of 2003, for example. With each iteration, chip costs go down, power goes up and device reliability improves. Couple that with Intel's revolutionary voltage control on the chip, and power consumption goes down (read: battery life increases).

Intel is targeting smart devices with Silvermont, a market where it has had little representation until now. That seems certain to change, with over 100 tablets and a handful of smart phones today sporting the "Intel Inside" logo. Sales of these units will be important to Intel's lagging "Other Intel Architecture" segment, which in 2012 had revenues of only $4.4 billion and showed an operating loss of $1.3 billion. I believe Intel has a shot at substantial improvement in 2014 with revenues as high as $7 or $8 billion (based on the addition of 80 to 100 million devices with Intel Inside at $40 content per device), which should be enough to bring the segment to a profit rather than a loss.

The decline in the personal computer business has been challenging for Intel, which in 2012 had revenues of $34.3 billion in this segment, a 3% decline from 2011.

In 2013, this decline is continuing. Intel is combating the decline with its Haswell and Silvermont processors aimed at PCs from desktop to ultra book to 2 in 1 devices and has augmented the processor advances with its innovative vPro Technology specifications for business computers than include solid state hard drives; wireless display; no password

This article was written by

Michael Blair profile picture
6.07K Followers
I retired as CEO of an Automotive Parts supplier, and manage an investment portfolio for myself and family. I have a BA in History from Royal Military College of Canada and an MBA from the University of Western Ontario. I have a graduate certificate in Advanced Valuation from NYU and graduate Diploma in Mining Law, Finance and Sustainability from Western University. I hold an LLM in Securities Law from Osgoode Hall Law School, awarded in February 2024. My first career was as a fighter pilot in the RCAF, and, following my MBA I joined McKinsey & Company, Inc. leaving them for Canadian GE. I left CGE as a Vice President in 1984 and founded The Enfield Corporation Limited ("Enfield") which grew from 243 employees in 1984 to over 10,000 in 1989 when Enfield was taken over and I was replaced as CEO. In 1989, I acquired control of Algonquin Mercantile Corporation, renamed Automodular Corporation in the late 1990's when I turned it to focus exclusively on automotive parts sub-assembly. Along the way, Algonquin turned a few ageing drug stores into Pharmx Rexall Drug Stores Ltd., sold to Katz group in 1997 and today a major Canadian drug store chain. I have been a private investor since 1971 both directly and through a private company controlled by myself and members of my family.

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