Intel: bottlenecks in the chip business at least until 2024
The Intel chip group is undergoing major restructuring: boss Gelsinger wants to make it a large contract manufacturer for others. That costs a lot of money – and Intel is currently being hit by declines in the PC market.
According to chip giant Intel, the current semiconductor bottlenecks could not be completely over in two years.
The problems with the production capacity and the availability of necessary machines are likely to last at least until 2024, said Intel boss Pat Gelsinger when presenting the latest quarterly figures.
Intel felt the slackening of the corona boom in the PC industry in the past quarter. Sales fell seven percent year-on-year to $18.4 billion. One factor in the decline was the 14 percent contraction in business with notebook chips to just under $6 billion.
While corporate interest remains strong, there has been a dip in cheaper consumer and educational PCs, Gelsinger said. Even with the forecast of around 18 billion dollars in the current quarter, Intel remained below the expectations of the analysts.
Data center sales
However, the company expects demand to pick up again in the second half of the year and is therefore sticking to its estimate of $76 billion for the full year. The consequences of the corona lockdowns in Shanghai for the industry should remain manageable if the measures are lifted soon, said CFO David Zinsner in a conference call with analysts.
The PC market, which had experienced a boom since 2020 with increased working and learning from home in the corona pandemic, had run out of steam in the quarter. According to calculations by the market research company IDC, sales of personal computers fell by around five percent year-on-year.
In contrast, Intel was able to increase chips for data centers again: Sales grew by 22 percent to a good six billion dollars. Gelsinger also wants to make Intel a major contract manufacturer for other chip suppliers. This area increased sales within a year from 103 to 283 million dollars – and wrote an operating loss of 31 million dollars. At the same time, Intel wants to build new factories in Germany, among other places, and is targeting investments of 27 billion dollars for this this year.
Overall, net income jumped from $3.4 billion to $8.1 billion. The stock fell about 4 percent in after-hours trading. Analysts had also expected more sales in the past quarter.