Chip megagiant Intel has revised its forecast for the first quarter of this year by close to one billion dollars.
The company said that people haven’t been buying the expected number of business PCs, and distributors, dealers and other vendors haven’t been ordering what Intel expected.
Intel thought that small and medium sized companies would flock in their droves to upgrade the now defunct Windows XP operating system. But that hasn’t happened.
It also said that currency conditions in Europe had affected its business.
Now Intel thinks its first quarter revenues will amount to $12.8 billion – down from its original estimate of $13.7 billion.
But if you’re starting to feel sorry for the behemoth, you don’t need to be. It said it is still expecting its gross margin to be about 60 percent, a gross margin that many other enterprises would die for.
Intel has announced details of its new family of Atom processors, and, as we predicted it has changed its naming strategy to mirror the Core series of processors.
Intel is renaming its Atom family with x3, x5, and x7 designations.
At the low end, the 28nm Atom x3, is basically a smartphone chip with Intel Architecture (SoFIA). The Atom x3 will be available in three distinct variants; all of which will come with integrated modems. All three are 64-bit capable.
The Atom x3-C3130 tops out at 1GHz, incorporates a Mali 400 MP2 GPU, and includes an integrated 3G (HSPA+) modem. The Atom x3-C3230RK has a clock speed of 1.2GHz and has a Mali 450 MP4 GPU, and a 3G modem. The Atom x3-C3440 clocks in at 1.4GHz, features a Mali T720 MP2 graphics core, incorporates a Category 6 LTE modem, and can optionally support NFC.
After looking at its own benchmarks, Intel said that the Atom x3-C3230RK can offer up to 1.8x the media editing performance of competing SoCs from Qualcomm and MediaTek.
The Atom x5 and x7 are Cherry Trail-based and the first Atom SoCs to be built using a 14nm manufacturing process. Both processor families support 64-bit processing, incorporate eighth generation Intel graphics, and support Windows and Android. They also support RealSense, True Key, and Pro WiDi. They don’t feature integrated modems but support Intel’s next generation XMM 726x and 7360 LTE modems.
Intel insists that the x7 offers two times the graphics performance of the existing Atom Z3795 in the GFXBench 2.7 T-Rex HD benchmark and 50 percent greater performance on the 3DMark Ice Storm Unlimited benchmark.
Intel has already announced that the Atom x3 and Bay Trail-based Atom x5 and x7 processors are shipping, and that products using the processors should be available during the first half of 2015.
Faced with stiff competition
at the mobile end of the market, it appears that Intel is hoping sales of expensive machines to enterprises will set the company back on track.
Talking to Reuters
, Tom Garrison, an Intel VP, said that sales of its vPro microprocessors represent a fifth of the corporate PC business.
Garrison said that there are over 100 million vPros in enterprises worldwide and sales of these particular processors are particularly lucrative.
It introduced what it described as a fifth generation vPro today.
In overall terms, Intel said earlier this month that the PC market will be flat in 2015 with prices falling.
Apple and Samsung appear to have buried any hatchets they might have had during the legal battle over the shape of the smartphone.
While the legal battle raised over such crucial matters as whether or not Steve Jobs invented the rounded rectangle, Apple moved away from Samsung as its main producer of chips. In fact analysts believed that in the long term Samsung would lose any Apple production completely.
According to the Maeil Business Newspaper it seems that Apple has changed its mind and Samsung is back to being the main supplier of processors powering Apple iPhones.
It looks like Samsung will be responsible for around 75 percent of the chip production for the next iPhone, the South Korean newspaper said.
The newspaper did not say how much the contract is worth and what other company will be supplying Apple. Samsung will make the chips from its factory in Austin, Texas, according to the report.
What appears to have happened is that not only has the row between Samsung and Apple cooled, Jobs’ Mob discovered that Samsung’s rivals, such as TSMC were not up to snuff or had capacity problems.
Sales of semiconductors rose by 7.9 percent in 2013, with Intel continuing to rule the chip roost.
A report from Gartner
said the top 25 vendors revenues rose by 11.7 percent, with those vendors grabbing 72.1 percent of the entire market revenues.
But it was DRAM sales that really shone last year. Gartner said the market grew by 31.7 percent during the year and undersupply and stable pricing continued to be the order of the day.
Andrew Norwood, a VP at Gartner, said all device categories grew in 2014 but the memory market outstripped them all.
Norwood said Intel saw a return of growth in 2014 after two years of seeing its revenues decline.
Intel’s Datacenter Group was the most stable of its different business units.
While Intel will reach its target of selling 40 million tablet microprocessors in 2014, they’re being sold at big discounts and with subsidies for vendors buying them.
Intel’s been the number one chip company for the last 23 years and owns 15 percent of the 2014 semiconductor market.
The next four top semi companies are Samsung, Qualcomm, Micron and SK Hynix.
Intel rival AMD said it has added two system on a chip (SoC) devices to its semiconductor roadmap.
The Carrizo and the Carrizo-L are being positioned as the firm’s answer to the mobile market.
The chips will support Microsoft DirectX 12, OpenCL 2.0, AMD’s Mantle and Freesync and support for Windows 10, when that emerges next year.
AMD senior VP John Byrne said his company is building on its existing intellectual property portfolio.
He said “our goal is to improve APU energy efficiency by a factor of 25 times by 2020”, and said the company would work with the latest industry standards.
The Carrizo microprocessor combines an X86 CPU core called Excavator with its next generation Radeon graphics in what AMD claims will be the world’s first heterogeneous system architecture compliant SoC.
The chips will ship in the first half of next year, Byrne said.
Fierce competition in the smartphone chipset and microprocessor market means prices of devices are likely to drop next year.
Smartcom, Qualcomm, Marvell and Broadcom are all competing in offering 32-bit quad core devices all hovering around the $8 to $9 mark. They are eyeing up Qualcomm’s Snapdragon 210 which costs $9 in bulk, according to suppliers that have talked to Digitimes.
It’s interesting that Intel doesn’t seem to be involved in this price war because it’s usually the first on the block to trigger price wars. That could indicate its tardiness in joining the smartphone fray.
There is growing demand for 64-bit eight core units which as part of the bill of materials cost around $15-$20. Four core CPUs cost around $12-$15.
All of this means a scrabble on behalf of the component suppliers which may well lead to cheaper overall bills of materials for smartphones.