Intel announced its financial results for the first quarter of this year, confirming analysts' concerns. Intel reported revenue of $12,7 billion, which represents year-over-year stagnation. Unfortunately, even these revenues could not bring Intel into the black, and the company reported a loss of $0,8 billion for the last quarter. This is double the amount compared to the same period last year, when Intel suffered a loss of $2024 billion for the first quarter of 0,4. Intel is not doing well for five main reasons, including the following.
Delays in technological development (processors, manufacturing process)
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Intel dominated chip manufacturing for many years thanks to its own production (so-called IDM – Integrated Device Manufacturing). But while TSMC and AMD moved to 7nm and 5nm processes, Intel was stuck on 10nm for years.
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This technological stagnation caused AMD to start offering more powerful and more energy-efficient processors, mainly in desktop and server applications.
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AMD now manufactures at TSMC, which is one step ahead – and Intel has lost the lead it had for practically decades.
Apple Stop buying Intel chips
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Apple Apple previously used Intel processors across its entire Mac lineup. In 2020, it switched to its own M1 (and now M2/M3) chips, based on ARM architecture.
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Not only did Intel lose a major customer, but it also showed that Apple Silicon it has better performance per watt – which highlighted Intel's weaknesses in the eyes of other companies and customers.
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Growing competition – mainly AMD and Nvidia
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AMD, under the leadership of Lisa Su, has risen extremely high - their Ryzens and Epycs compete with (and often surpass) Intel in both the gaming and server segments.
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Nvidia has dominated the AI market – thanks to the H100 GPU chips and future generations. Intel is trying to compete with Gaudi chips, but so far without much success.
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Intel missed the dawn of AI, which is now worth tens of billions of dollars a year - instead, it is still betting mainly on classic CPUs.
Falling demand for PCs and servers
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After the pandemic boom, the PC market cooled significantly.
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Intel is heavily reliant on desktop and server processors – and the decline in these segments has hit it harder than its competitors, which have a more diversified portfolio.folio.
Huge costs and losses in the Foundry division
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Intel is investing billions in building its own factories (Intel Foundry Services) to compete with TSMC and Samsung as a third-party chip manufacturer.
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But this effort is extremely costly and has not yet yielded the expected profits – instead, it is deepening the loss.
Unfortunately, the financial results and other problems that Intel is experiencing above mean that the company needs to make dramatic cost savings. In addition to cuts in development, marketing or building new factories, this also means layoffs. This is expected to affect up to 20% of all employees.ancs, which would mean that Intel is preparing to lay off over 21 employeesancFrom 1 September 9, all employees must alsoancand without exception spend in kancelegy miniat least 4 days in a week and Intel is no longer going to accept more home office than 1 day in weeks. However, management remains optimistic and claims that even though they have to make difficult decisions, they will lead to a better tomorrow.
Gallery
Where is the "2"nm Intel? Google the articles:
Intel 18A reportedly has a very low 10% yield, TSMC's 2nm is better even with density (6.12.24)
Intel Nova Lake rumored to be manufactured on TSMC's 2nm process (24.4.25)
or Intel Foundry = https://www.youtube.com/watch?v=vYrbaEDDGA8 ;)