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Intel Corporation (INTC)

  • Tue, Jan. 20, 9:46 AM
    • "Our diligence with industry sources revealed that there has been a sharp reduction in server activity entering 2015," writes JMP, downgrading Intel (INTC) to Market Underperform and setting a $30 target five days after the chip giant's Q4 report. (source: Notable Calls)
    • JMP adds there's a risk of excess server CPU inventory following a Q4 in which division sales rose 11% Q/Q and 25% Y/Y (easily outpacing PC CPU division growth of 3% Y/Y).
    • Intel has forecast server CPU division sales will post a 15% CAGR through 2018, aided by strong Web/cloud and HPC server demand. PC CPU division sales, on the other hand, are expected to fall by a low-single digit % this year, after rising 4% in 2014.
    • Shares are off modestly following the downgrade. Intel currently goes for 15x 2015E EPS.
    • Update (10:35AM): Intel is now down 1.5%.
    | Tue, Jan. 20, 9:46 AM | 8 Comments
  • Fri, Jan. 16, 12:43 PM
    • Intel (INTC -0.4%) is off fractionally after providing in-line revenue guidance and a soft gross margin forecast to go with a Q4 beat. Charter Equity has downgraded to Market Perform, and Stifel (Buy) has upped its target by $2 to $41.
    • Not surprisingly, bulls are focusing heavily on the 25% Y/Y growth posted by Intel's server CPU unit (DCG). Jefferies: "To say DCG is a hidden gem is an understatement ... all four segments (Enterprise, Cloud, High-Performance Computing, Networking) posted growth. We think Intel’s new server cycle (Grantley) helps in 2015, but view drivers in DCG to be largely secular."
    • Also going over well: Intel's 2014 capex ($10.1B) was below prior guidance of $10.5B-$11.5B, and its 2015 guidance midpoint is only at $10B. Wells Fargo observes the 2014/2015 figures are below 2011-2013 levels of $10.7B-$11B, even though "2015 revenue that is likely to be substantially higher than in any of these years."
    • Those less positive often highlight slowing PC CPU growth. Ascendiant Capital thinks Q4 PC CPU division revenue ($8.9B, +3%) fell short of a $9.2B consensus. "It looks as though the upgrade cycle is tapering off and we expect a return of a secular declining PC market in 2015." Bernstein, reiterating inventory concerns: "Intel’s [PC] unit shipments still remain well above market data on a YoY basis, and account receivable DSOs increased sharply."
    • Intel has guided for PC division sales to fall by a low-single digit % in 2015, following a strong 2014 boosted by an inventory refresh and share gains against AMD (AMD -4.2%). AMD, which reports on Jan. 20, is selling off today.
    • On the CC (transcript) CEO Brian Krzanich stated Intel shipped 46M tablet CPUs in 2014, beating a goal of 40M, and that the company is committed to driving out $800M in mobile chip unit costs in 2015. Thanks in large part to heavy marketing subsidies, the unit posted a $4.2B 2014 op. loss.
    • Prior Intel earnings coverage
    • Update: With the help of a tech rally, Intel closed up 0.7%. AMD closed down 5.2%.
    | Fri, Jan. 16, 12:43 PM | 42 Comments
  • Fri, Jan. 16, 10:54 AM
    • Arguing Intel's (NASDAQ:INTC) manufacturing process lead threatens Qualcomm's (QCOM -0.5%) mobile processor share, Drexel Hamilton's Rick Whittington has downgraded the mobile chip/IP giant to Hold, and cut his target by $25 to $75.
    • Whittington observes Intel is now selling 14nm processors - its 14nm Cherry Trail tablet CPUs recently began shipping - while Qualcomm has just begun selling 20nm processors (made by TSMC). He adds top foundries are slow to ramp 14nm and 16nm FinFET processes - Samsung/Globalfoundries are rolling out the former, TSMC the latter - and that Intel "also appears set on commoditizing low-mid-range LTE [baseband modems] for incorporation in their mobile processor offerings, conjuring a price war."
    • Worth noting: 1) While Intel has begun offering powerful app processors that leverage advanced manufacturing processes, it hasn't launched high-end baseband/app processors that can take on Qualcomm's Snapdragon 800 series. 2) A large portion of Intel's low-end efforts - both for app processors and baseband/app processors - are tied to alliances with Chinese chipmakers who (like Qualcomm) rely on 3rd-party foundries.
    • Qualcomm is off modestly following the downgrade. FQ1 results arrive on Jan. 28.
    | Fri, Jan. 16, 10:54 AM | 12 Comments
  • Thu, Jan. 15, 4:33 PM
    • Intel (NASDAQ:INTC) had a Q4 gross margin of 65.4%, +40 bps Q/Q and +340 bps Y/Y,  above a guidance midpoint of 64%, and contributing heavily to its EPS beat. However, GM is expected to fall to 60% (+/- 2%) in seasonally weak Q1, and 2015 GM guidance of 62% (+/- 2%) is mostly below a 2014 figure of 63.7%.
    • In its CFO commentary (.pdf), Intel states higher platform unit costs and higher factory start-up costs will respectively have 200 bps and 150 bps Q1 impacts on GM relative to Q4. Lower platform volumes will have a 100 bps impact, and higher platform write-offs (mostly related to the next-gen Skylake platform) a 50 bps impact.
    • PC CPU division performance: Revenue +3% Y/Y to $8.9B. Volumes +6%, ASPs -2% (mix shift to Atom). Desktop volumes +1%, ASPs flat. Notebook volumes +11%, ASPs -3%. Op. profit +18% $3.98B.
    • Server CPU division performance: Revenue +25% to $4.1B (boosted by the Grantley launch and cloud demand). Volumes +15%, ASPs +10%. Op. profit +39% to $2.23B.
    • With marketing subsidies to OEMs still taking a toll, the mobile chip division posted a $1.11B op. loss on official revenue of -$6M. The IoT Group had revenue of $591M (+10%), and a $185M op. profit. Software/services had revenue of $557M (-6%), and a $25M op. profit. Everything else produced revenue of $617M (+23%), and had an op. loss of $856M (includes one-time costs).
    • $4B was spent on buybacks vs. $4.2B in Q3. R&D/MG&A spend rose 4% Y/Y to $5B.
    • The 2015 capex budget is at $10B (+/- $500M). At the time of the Q3 report, the 2014 budget was $11B (+/- $500M).
    • INTC -1.2% AH. Q3 results, PR.
    | Thu, Jan. 15, 4:33 PM | 5 Comments
  • Thu, Jan. 15, 4:04 PM
    • Intel (NASDAQ:INTC): Q4 EPS of $0.74 beats by $0.08.
    • Revenue of $14.72B (+6.4% Y/Y) beats by $20M.
    • Expects Q1 revenue of $13.2B-$14.2B vs. a $13.77B consensus.
    • Expects mid-single digit 2015 revenue growth. Consensus is for 4.2% growth.
    • Shares -2.3% AH.
    • Press Release
    | Thu, Jan. 15, 4:04 PM | 59 Comments
  • Wed, Jan. 14, 5:35 PM
  • Mon, Jan. 12, 5:58 PM
    • IDC estimates global PC shipments fell 2.4% Y/Y in Q4 to 80.8M - a bigger decline than Q3 and Q2's 1.7%, but better than expectations for a 4.8% drop. Gartner is more positive, estimating shipments rose 1% to 83.7M.
    • Both firms observe emerging markets, where tablet cannibalization remains a major issue, remain in worse shape than developed markets. IDC also states commercial PC demand (boosted earlier this year by MSFT's ending of Win. XP support) has slowed, and that "market progress has been fueled by low-priced systems, including growth of Chromebooks and [Microsoft's] promotion of Windows 8 + Bing."
    • On the bright side, both IDC and Gartner report Asia-Pac returned to positive growth, and that broader consumer demand is gradually improving. The U.S. consumer market is expected to return to positive growth in 2015, aided by slowing tablet demand and the Windows 10 launch.
    • IDC believes all top-5 vendors gained share from rivals with less scale. A quarter after cracking the top-5 for the first time with a 6.3% share, Apple's (NASDAQ:AAPL) unit share is believed to have risen to 7.1% (+130 bps Y/Y) on the back of 4.9M shipments (+18.9%). Given higher ASPs, revenue share might be around 15%.
    • Market leader Lenovo's (OTCPK:LNVGY) share rose 140 bps to 19.9%; #2 HP's (NYSE:HPQ) rose 300 bps to 19.7%; #3 Dell's rose 140 bps to 13.5%; #4 Acer's (OTC:ASIYF) rose 40 bps to 7.7%. Non-top 5 firms saw their share drop 740 bps to 32.2%, with their shipments declining 20.7%.
    • Intel (NASDAQ:INTC), which tends to have good visibility into industry demand, reports on Thursday.
    • Related tickers: AMD, NVDA, STX, WDC, HTCH
    | Mon, Jan. 12, 5:58 PM | 43 Comments
  • Wed, Jan. 7, 2:27 AM
    • Next at the Consumer Electronics Show in Las Vegas: Intel (NASDAQ:INTC) Chief Executive Brian Krzanich unveiled Curie, a new button-sized computer designed for smart clothes. The button includes Bluetooth radio and is due out later this year.
    • The CEO also showed off a selfie-snapping flying camera and called the small wrist-worn drone Nixie.
    • Other smart gadgets Krzanich commented on include an athletic wearable being developed with Oakley and smart glasses being worked on with Luxottica (NYSE:LUX).
    | Wed, Jan. 7, 2:27 AM | 2 Comments
  • Mon, Jan. 5, 12:17 PM
    • Four months after launching its first 14nm Broadwell CPUs - the ultrabook/tablet-focused Core M line, also known as Broadwell-Y - Intel (INTC -0.5%) has rolled out over a dozen CPUs based on its Broadwell-U architecture, which targets mainstream notebooks and smaller desktops. Plenty of products featuring the chips should be shown off at CES.
    • The dual-core CPUs will be sold under the Celeron, Pentium, and Core i3/i5/i7 labels, and (naturally) come with integrated GPUs. Most have an official max power draw (TDP) of 15W, but a handful have 28W TDPs and also come with relatively powerful Iris 6100 GPUs. The Core M line can deliver sub-5W TDPs.
    • Intel claims a Core i7 Broadwell-U CPU can respectively deliver 22% and 50% increases in 3D graphics and video conversion performance over a comparable 22nm Haswell CPU, and (perhaps more notably) up to a 1.5-hour increase in battery life. Quad-core Broadwell parts aimed at tower desktops and high-end notebooks aren't expected until mid-2015.
    • Rival AMD's (AMD -1.1%) most advanced PC CPU lines still rely on 28nm processes; the company has promised 20nm parts will arrive later this year.
    • The launch comes as MKM makes a belated upgrade to Buy, and hikes its target by $5 to $45. "We likely kept our neutral rating (with positive bias) for too long as PCs stabilized, data center improved, and INTC demonstrated a flexible approach to succeed in tablets and access existing China consumer channels."
    • MKM is also upbeat about server CPU demand, given new product cycles and strong cloud and big data-related demand. Intel has forecast its server CPU division sales will rise at a 15% annual clip through 2018. PC CPU division sales are expected to fall slightly in 2015, following a strong 2014.
    • Also: Intel has bought a 30% stake in smart glasses maker Vuzix for $24.8M. The investment follows an alliance with eyewear giant Luxottica, and a WSJ report that the next version of Google Glass will sport an Intel CPU.
    | Mon, Jan. 5, 12:17 PM | 14 Comments
  • Thu, Jan. 1, 2:52 AM
    • After failing to launch a Tizen-powered smartphone, Samsung Electronics (OTC:SSNLF) is now attempting to power every one of its Smart TVs in 2015 with its homegrown operating system.
    • Together with Intel (NASDAQ:INTC), Samsung has been developing Tizen for years, with an initial focus of bringing the platform to its smartphones as an alternative to Google’s Android operating system.
    | Thu, Jan. 1, 2:52 AM | 11 Comments
  • Thu, Jan. 1, 2:19 AM
    | Thu, Jan. 1, 2:19 AM | 17 Comments
  • Dec. 30, 2014, 6:05 PM
    • French carrier Iliad's (OTC:ILIAF) unit plans to launch a cloud infrastructure service next month that runs on servers featuring ARM-based (NASDAQ:ARMH) CPUs supplied by Marvell (NASDAQ:MRVL). Making good on ARM's promise of high densities, 18 servers - each sporting one quad-core CPU - can fit onto a blade, and 16 blades can fit within a chassis.
    • Though it's no Google or Amazon, Iliad provides a useful reference win for ARM server CPU vendors as they try to take share from Intel (NASDAQ:INTC), whose Xeon CPUs claim the lion's share of the server market, including most Web/cloud data center deployments.
    • Canaccord has forecast ARM server CPUs, still in their infancy, will grab a 20% share by 2018. Hyperscale data centers and application-specific server appliances are seen as areas where ARM-based solutions could stand out.
    • Intel is looking to head off the ARM threat both by developing low-power Atom server CPUs, maintaining a manufacturing process edge, and (notably) providing a variety of custom CPUs to Internet giants such as Amazon, Google, Facebook, and eBay; the latest offerings are packaged with Altera (NASDAQ:ALTR) FPGAs to provide on-the-fly programmability.
    • Nonetheless, Facebook's Open Compute Project supports both ARM and x86 CPUs, and Google has been reported to be thinking of building its own ARM chip. An Amazon VP recently stated ARM vendors aren't keeping pace with Intel. But Amazon might simply be opting to create its own ARM designs, given it has hired several key engineers from defunct ARM vendor Calxeda.
    • Cavium (NASDAQ:CAVM) and AppliedMicro (NASDAQ:AMCC) are often viewed as ARM server CPU plays. AMD, Qualcomm, and Texas Instruments are also competing in this space.
    | Dec. 30, 2014, 6:05 PM | 25 Comments
  • Dec. 9, 2014, 6:14 PM
    • The Intel IoT Platform (NASDAQ:INTC), launched today, aims to provide a "reference model" for Web-connected embedded devices (the proverbial Internet of Things), along with related software and services.
    • The solution includes: 1) An updated version of the Intel IoT Gateway (launched last year), which provides Web connectivity and data sharing for embedded devices. The gateways will be offered by 20 ODMs by early 2015. 2) Management software from Intel's Wind River (embedded software) unit. 3) Security tools from McAfee. 4) An API and traffic management tools for developers (enabled by the Mashery acquisition).
    • Intel is also partnering with Dell, Accenture, SAP, Wipro, and others to create solutions that "provide a repeatable foundation" for the IoT Platform that developers can build customer-specific solutions on top of.
    • The chip giant's main goal, of course, is to drive CPU sales - partly for gateways, but primarily for the devices they interact with. Intel offers Atom CPUs for more powerful embedded devices, and Quark CPUs for smaller, low-power products.
    • The Intel IoT Platform will face off against ARM's (NASDAQ:ARMH) mbed IoT platform (launched in October). ARM, whose CPU cores claim a large and growing share of the microcontroller market, has provided mbed with an OS, device server software, and developer tools. The solution is meant to run on ARM's low-power Cortex-M CPU cores.
    | Dec. 9, 2014, 6:14 PM | 7 Comments
  • Dec. 3, 2014, 10:27 AM
    • Luxottica, (LUX -0.5%), owner of Ray-Ban, Oakley, and a number of other premium eyewear brands, is forming a multi-year R&D partnership with Intel (INTC -0.1%) to "fuse premium, luxury and sports eyewear with smart technology."
    • The first product to be created by the alliance is due in 2015. No word on which Intel processor line will be used - Atom and Quark are the likely candidates.
    • With the market for smart eyewear in its (very) early stages, and ASPs likely to be lower than those for Intel's PC CPUs, the deal is unlikely to move the needle much near-term for a company expected to post 2015 sales of $58.2B. But it bolsters Intel's standing in the market relative to the ARM CPU developers who claim the lion's share of smartphone/tablet processor sales.
    • The WSJ recently reported Intel's processors will power the next version of Google Glass, which presumably will feature a much lower price point than the $1,500 (Texas Instruments-powered) Explorer Edition. Google already has a Glass partnership with Luxottica.
    | Dec. 3, 2014, 10:27 AM | 3 Comments
  • Dec. 1, 2014, 9:53 AM
    • Intel (NASDAQ:INTC) has bought PasswordBox, provider of an online and mobile password-management service declared to support "more websites and apps with instant login than any other product on the market." Terms are undisclosed.
    • PasswordBox, based out of Montreal, has seen its password-storage apps downloaded 14M times. The startup offers both Android/iOS apps and tools for popular PC Web browsers.
    • PasswordBox has been added to Intel's Security Group, which is headlined by McAfee. Intel currently offers identity-protection solutions for businesses that are linked to hardware tokens embedded within its CPUs.
    | Dec. 1, 2014, 9:53 AM | 2 Comments
  • Dec. 1, 2014, 3:50 AM
    • Intel (NASDAQ:INTC) will power the next version of Google (NASDAQ:GOOG) Glass expected next year, WSJ reports, replacing the current processor from Texas Instruments (NASDAQ:TXN).
    • Intel chips already power several Google devices and items, including Google's servers, self-driving cars and the Nexus Player.
    | Dec. 1, 2014, 3:50 AM | 5 Comments
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Company Description
Intel Corporation is a semiconductor chip maker. It develops integrated digital technology products like integrated circuits, for industries such as computing and communications.