> I wouldn't count Intel out yet. Sure, things don't look that great
I always get a kick out of the sentiment toward Intel on HN.
Intel is booming financially. Things have never been better for them in that respect. They have every opportunity to fix their mess.
Intel has eight times (!) the operating income of Nvidia, with a smaller market cap.
Intel is one of the world's most profitable corporations. $26 billion in operating income the last four quarters. Their margins are extreme. Their sales are at an all-time high. Their latest quarterly report was stellar.
In just 2 1/2 years Intel has added a business the size of Nvidia and AMD combined.
If they can't utilize their current profit-printing position to recover, then they certainly deserve their tombstone. Nobody has ever had an easier opportunity to find their footing.
This sounds very similar to the situation Nokia was in around 2007:
- Nokia was booming financial. Things had never been better for them in that respect.
- Nokia had XX times (!) the operating income of Apple's mobile business.
- Nokia was one of the world's most profitable corporations.
And, yet, the writing was on the wall. Nokia was doomed once the smartphone era came. That's where Intel is today: AMD crushes them on the high-end general purpose CPUs. ARM crushes them on I/O performance and the low-end for general purpose CPUs. GPUs crush Intel in the middle, for special-purpose (mainly single-precision floating point) computing.
Right now, large portions of new computer sales, and an even larger portion of the high-margin cpu sales, come from cloud computing. AMD and ARM are stealing huge market share from Intel on that front. I don't see that momentum changing any time soon.
There's a reason that Intel has 8x the operating income of NVidia while having a smaller market cap. It's not because of where they are currently--it's where they are going. Stock market valuations are forward-looking, and the future doesn't look so bright for Intel.
Nokia was fine - just switch flagship from Symbian to Android, continue feature phones and Maemo. After so many years and under different manufacturer brand is still alive.
Stock market valuations are forward-looking, but they aren't always predicting the right future.
Personally I won't be betting on or against Intel - it wouldn't shock me if they follow the Nokia route, it also wouldn't shock me if they come out with a new generation that puts them back on top within the next few years.
Intel is booming financially. Things have never been better for them in that respect. They have every opportunity to fix their mess.
So was RIM in 2010. Profits are a trailing indicator. The PC market is really small compared to the mobile market and declining. While Apple only has 10% of the overall market, it has a much higher percentage of high end personal computers and Intel is about to lose Apple as a customer.
PCs also are having longer refresh cycles. What does “recovery” look like? PC sells going up? That’s not going to happen.
They still have the server market while that is probably growing, Amazon is pushing its own ARM processors hard and MS and Google can’t be too far behind.
Intel has a habit of putting snatching defeat from the jaws of victory.
Their decades of more or less monopoly status has made them complacent, their revenue is high still because of this inertia built into the market that simply will not vanish.
The datacenter for example is still dominated by Xeon not because people like Xeon over Epyc but because there is not a easy migration path between the 2 platforms. If I was building a whole new server farm with all new VM's I would choose Epyc all day... but if I need to upgrade hosts in an existing farm with no down time well that will need to be Xeon then...
When it comes to desktops/laptops though, Lenovo's AMD line is attractive and suffers no such problems
I find it humorous too, but I think it's easily explained: we get a constant stream stories of the plucky underdogs with their fancy engineering achievements. HN loves both industry disruption and engineering achievements, so it's a sort of self-reinforcing reality distortion field. See Tesla for a very similar sort of story.
The innovators and underdogs are always great to see, and they fuel our collective imagination, so it's no surprise that they dominate the HN front page. Of course, that mind-share dominance is in stark contrast to the well-entrenched money-printing machines they're trying to disrupt, who are happy to keep dominating their respective industries year after year instead.
This is very true. They got this profitable though by gutting every long term investment in new forays: they sold off their ARM business, their modem business, they never bothered to make a serious GPU or mobile chip, etc.
The margins on those big Xeon chips have been so good that they ditched everything else, and painted themselves into a corner, sitting by the sidelines for the past 20 years as new markets emerged.
Right, that's kinda my point, maybe not strongly enough stated. The "don't look that great" is "they'll probably have to buy fab resources from someone else" to keep up perf-wise (like their competitors, who are fabless), not "they're going bankrupt anytime soon".
I always get a kick out of the sentiment toward Intel on HN.
Intel is booming financially. Things have never been better for them in that respect. They have every opportunity to fix their mess.
Intel has eight times (!) the operating income of Nvidia, with a smaller market cap.
Intel is one of the world's most profitable corporations. $26 billion in operating income the last four quarters. Their margins are extreme. Their sales are at an all-time high. Their latest quarterly report was stellar.
In just 2 1/2 years Intel has added a business the size of Nvidia and AMD combined.
If they can't utilize their current profit-printing position to recover, then they certainly deserve their tombstone. Nobody has ever had an easier opportunity to find their footing.