News Qualcomm reportedly explores buying portions of Intel's PC client business

[ThomasKinsley]

Intel has been a much better company for the PC world than Qualcomm. Developing software or operating systems to support literally every Intel and AMD CPU on the market is relatively straightforward. Whereas Linux support for Snapdragon X is being added literally one laptop at a time. And Intel's Linux GPU drivers are pretty good.

This is a side effect of ARM architecture rather than Qualcomm. The same fragmentation happens on mobile phones, whether it's SnapDragon, MediaTek, Exynos, or Tensor.

What am I missing? Intel book value is more than 100bln$, they still have cash (real cash) of more than 20bln$. Why everyone is saying this is the end?

Fabrication development starts years before a product is released. Intel promised an ambitious 5 nodes in 4 years (something incredibly difficult for any fabrication unit to achieve let alone Intel that was notoriously stuck on 10nm for years). Their plans do not match their capabilities, so they likely see now that they are going to be left behind.

 

[TheSecondPower]

This is a side effect of ARM architecture rather than Qualcomm. The same fragmentation happens on mobile phones, whether it's SnapDragon, MediaTek, Exynos, or Tensor.

I think the reason why x86 PCs are just a single target for OS developers is because Intel standardized the boot or EUFI or something. Smartphones are fragmented in part because Qualcomm never did the same thing.

 

[Gururu]

What am I missing? Intel book value is more than 100bln$, they still have cash (real cash) of more than 20bln$. Why everyone is saying this is the end? It can loose for a few years and still be alive. Raptor Lake performance is quite good, only power usage is bad. Meteor Lake, while not the best is also good and there are laptops with great battery life matching Macbook M3. Intel still sell more CPUs than AMD. Lunar Lake just announced looks fantastic. Arrow Lake around the corner.
I don't like that shareholders are/were the most important for Intel and every project below 50% margin was turned off. Maybe time to change strategy and focus on market instead of shareholders. Gross margin now below 50%, but so what...

You aren’t missing anything. Looking at the market, tech stocks are getting rocked. NVidia just broke the record for largest loss in history.

 

[systemBuilder_49]

What's happening at Intel? I knew they've been struggling to get new processes up and running since 14nm and 10nm (Tick, Tock, Sproing, Thunk, Stomp, ARGH!!), but this is something else. They were generally running over a $70 billion a year revenue until Q2 '22 when it all went to pot. Now they're closer to $55 billion and cancelling projects left and right. Serious, I didn't call Intel falling apart like this.

Their laptops are uncompetitive and their desktops are catching fire. The new Chromebook Lake processors (lunar lake) have 4 cores and 8 threads, something we moved beyond in 2011 if I'm not mustaken. Note: 1 e-core = 1 secondary thread! The only people buying Intel laptops are people buying them on blowout clearance prices or those old timers trained like pavlov's dog who always buy Intel when the bell rings because its all they know ...

 

[YSCCC]

What am I missing? Intel book value is more than 100bln$, they still have cash (real cash) of more than 20bln$. Why everyone is saying this is the end? It can loose for a few years and still be alive. Raptor Lake performance is quite good, only power usage is bad. Meteor Lake, while not the best is also good and there are laptops with great battery life matching Macbook M3. Intel still sell more CPUs than AMD. Lunar Lake just announced looks fantastic. Arrow Lake around the corner.
I don't like that shareholders are/were the most important for Intel and every project below 50% margin was turned off. Maybe time to change strategy and focus on market instead of shareholders. Gross margin now below 50%, but so what...

The problem is with raptor lake trouble exploding/ exposing the weakness. They literally pushed too far and ruin the Intel brand name. Back then buying Intel you might be quite a bit slower than AMD but you got reliability and software optimisation guaranteed. That’s why they can afford being slower but still dominated the market, and generate enough revenue to develop their foundries.

This time round it took them too long to admit the problem, and apparently now even running out of stock to do rma replacements promptly. The result in more PR disasters likely just hit their coming gen quite a bit a tough time to stay relevant and surivie IMO

 

[suryasans]

let's try to see things in a different way, remember when 3dfx was dominating and all of a sudden it goes out of business and nvidia buys some parts if I remember correctly and then now we have the nvidia giant. Qualcomm may be the next future in my opinion

But unlike 3Dfx which went bankrupt just 8 years after its founding, Intel is a big and a very mature company. It flogged off non core businesses like WindRiver and McAfee before they drained out the resources needed to its in-house chips manufacturing.

 

[watzupken]

As goes Intel so goes western chip making. And the world will not be able to afford TSMC shutting itself down if China makes a move.
I wonder if the chips act grants will ever be paid.

It is unlikely that US government will allow Intel to fail after awarding them with a lot of taxpayers' money already. So I would believe US will continue to fund them since it is the only US based foundry that is advanced enough.

In any case, it is quite shocking to see how fast things unraveling over at Intel. Lunar and Arrow Lake will be very important products to keep revenue flowing into their coffer, but the loss is unlikely to go away because the cost of underutilized foundry and aggressive expansion will become a very heavy burden for them.

 

[watzupken]

But unlike 3Dfx which went bankrupt just 8 years after its founding, Intel is a big and a very mature company. It flogged off non core businesses like WindRiver and McAfee before they drained out the resources needed to its in-house chips manufacturing.

Being big can help weather some business mistakes, but if they have been going the wrong direction for I think almost a decade now, it will not be easy to turn this "big lorry" around. Bankrupt, I feel is quite unlikely because I believe US will not let it go down. But it will cost taxpayers dearly to bail them out if Pat exhausts all available options to save the company.

 

[paviko]

Intel fell 2 genrations behind TSMC.

They are totally f*cked and Pat seeems to have NO IDEA what to do. He should have spun off the foundry 3Y ago when it was worth something. They don't have enough business in-house to keep the foundry alive and competitive ... Now its just an anchor around Intel's neck ...

When you look at Apple M3 (TSMC 3) vs M2 (TSMC 5) there is no much diffrence. It's not even half generation node improvment. I don't see Intel being 2 generation behind. Core is very old architecture with small updates and with Intel 4 node Meteor Lake is still competing well with M3 (TSMC 3), AMD and Qualcomm (TSMC 4). It's not the best, it's behind, but that's how it is on market, sometimes you are at top, sometimes third place... Will Lunar Lake with TSMC 3 be so much better, we will see.

 

[Gururu]

Being big can help weather some business mistakes, but if they have been going the wrong direction for I think almost a decade now, it will not be easy to turn this "big lorry" around. Bankrupt, I feel is quite unlikely because I believe US will not let it go down. But it will cost taxpayers dearly to bail them out if Pat exhausts all available options to save the company.

I am not sure I follow "wrong direction"? Is this an engineer or business analysis of their technology? To date, Intel still commands 2/3 market share for PCs and laptops with Intel CPU. Hard to say that this will change anytime soon because of a wrong direction taken IMO.

 

[Notton]

idk..maybe start cutting the CEO's enormous pay?
Why reward a guy who let this fallout happen? This is mostly on leadership failing the company.

Gelsinger inherited most of these problems.

Brian Krzanich, CEO from 2013-2018. PCs in general were in decline, and the production delays to smaller nodes didn't help. Mismanagement at its finest. He's the one who lost the Apple contract.
Like, literally, just look him up for all the controversies he caused.

Bob Swan, CEO from 2018 to 2021, didn't do much to correct course. But he also didn't do anything to rock the boat, as he's just a transitional CEO.

Gelsinger is responsible for spending on fabs and green-lighting 13th and 14th gen. It's a little hard to say if he played his cards right, as it remains to be seen how things play out.

 

[Roland Of Gilead]

Fabrication development starts years before a product is released. Intel promised an ambitious 5 nodes in 4 years (something incredibly difficult for any fabrication unit to achieve let alone Intel that was notoriously stuck on 10nm for years). Their plans do not match their capabilities, so they likely see now that they are going to be left behind.

Yup! Totally agree. It wasn't long ago, there was a article/thread about the 5y4n plan. Well ,the plan has really fallen apart now. One of the editors on Tom's and many users thought this was totally achievable. Bit of a dream world really. This is no surprise. The writing has been on the wall for months if not years.

I don't think this is the end for Intel though. But it will be a sharp shock, which may take some time to come back from.

 

[TheHerald]

Their laptops are uncompetitive and their desktops are catching fire. The new Chromebook Lake processors (lunar lake) have 4 cores and 8 threads, something we moved beyond in 2011 if I'm not mustaken. Note: 1 e-core = 1 secondary thread! The only people buying Intel laptops are people buying them on blowout clearance prices or those old timers trained like pavlov's dog who always buy Intel when the bell rings because its all they know ...

Man let's be realistic. The only desktops on fire were the amd ones.

 

[TheSecondPower]

Yup! Totally agree. It wasn't long ago, there was a article/thread about the 5y4n plan. Well ,the plan has really fallen apart now. One of the editors on Tom's and many users thought this was totally achievable. Bit of a dream world really. This is no surprise. The writing has been on the wall for months if not years.

I think the 5 nodes in 4 years plan was a little misleading. The first was Intel 7, which was a minor update to the 10nm node. The second and third were minor versions of a single new node (Intel 4 and 3), and the fourth and fifth were again minor versions of a single new node (Intel 20A and 18A). So in reality what Intel was planning was 2 major nodes in 4 years, and the first of those 2 was orginally scheduled for release before that announcement.

 

[Orlincho]

Talking about a shrinking market is nonsense, when in fact if anything grows nowadays, it's the need of processing power. This article is based on rumors - even Qualcomm explicitly states that they has not approached Intel for a formal deal. Yes, Intel was a quasi monopoly but hey, they kept fueling the computing market and thanks to Intel we had the cloud era, the internet, the gaming and now we have AI.
Gelsinger is an engineer and he is the best chance for Intel to turn things around. This is a huge boat and needs time to change direction.