Intel’s financial results for its second-quarter of 2023 were announced on 27 July. After two reported quarters of losses, we are now seeing profits. AMD’s financials also indicate that AMD’s inroads on Intel’s base could be slowing down as Intel puts up a greater fight.
Intel was the dominant player in the PC processor market for its entire history. Intel’s fall from its leadership position was due to internal decisions made by an ex-CEO and a new board.
Intel’s uniqueness in the industry is not only because it was the early leader, but also because it retained manufacturing capability that allowed it to weather the pandemic fairly well at first because it did not have the supply problems many of its fabless counterparts enjoyed. This advantage was offset somewhat by the shortages of other components in Intel’s products.
This week we’ll talk about Intel recovering and I’ll close by presenting my Product of The Week: Intel A770’s ARC-GPU, which is a great option if you want to build a high-end PC, like the one I built.
Intelligence is Important
Intel’s importance as a manufacturer of microprocessors is increasing due to the uncertainty of world politics.
Taiwan has a significant amount of microprocessor manufacturing capacity, and is therefore at risk from being attacked or destroyed by China. In a war the ability of a country to manufacture advanced weapons is directly related to the manufacturing capability that was lost early in the conflict.
Even though there are other places in the world with more manufacturing capacity, this would not be enough to compensate for what could be lost in Taiwan. It would be very difficult to move parts internationally in a war as large-scale as that with China. China has aggressively bought or locked up some of these extra resources, so that only the domestic manufacturing capability can provide what is needed to execute this war successfully.
Intel’s laser-focus on creating the Chips Act in order to build up U.S. manufacturing capacity would be critical for the U.S. to survive future wars and pandemics, especially a war against China. This would make the company an asset that the U.S. must protect.
Intel also does the majority of the work in defending x86 against competing technologies such as ARM. However, ARM’s latest moves have made it less desirable. The technology continues to be a foreign threat for the U.S.’s dominance in microprocessors. Intel is responsible for a large part of the work to build and maintain developer support for x86. It would be a blow to the x86 platform which is still used in most PCs, servers, and workstations.
Intel’s survival is crucial to the U.S., and other Western countries that have significant investments in x86-technology. AMD, as good as it is, doesn’t have the potential to replace Intel.
Turning Around a Business
Pat Gelsinger knows that corporate turnarounds aren’t easy. After successfully reviving VMware, he returned to Intel. Intel’s situation is more complex. Gelsinger took VMware over when the company was simply underperforming.
When Gelsinger assumed the leadership of Intel, it was in a much more difficult situation. Gelsinger’s and Bob Swan’s predecessors made a number of poor decisions, which led to the company’s problems. Swan had been a successful CEO, despite having a background in finance. Although he tried to guide the company, as a financial specialist, he wasn’t qualified to run Intel.
Gelsinger joined Intel to a mess of unfunded critical projects and alienated employees. The company was also in a death spiral. Intel’s transformation is still not complete, and some mistakes were made. For example, laying employees off and reducing their compensation was not the best decision. These decisions can make employees resentful of management, leading them to resentment and unplanned turnover, which can lead to the death of an organization.
Intel’s employees did a good job and managed to bring in a respectable quarter. This gives us hope that Intel has now gotten out of its rut and will continue improving even before the new manufacturing capabilities are available.
Intel’s competition
Intel’s main competitors are AMD, Nvidia and Qualcomm. AMD and Nvidia are both running smoothly with no noticeable mistakes. Nvidia is now the company Intel should be watching because it has leveraged its GPU capabilities to gain a strong CPU presence.
Qualcomm had its own problems, with Apple working to eliminate it from the market and its lack in a PC solution. This is something it should rectify next year by increasing competition on Intel.
Nvidia poses the greatest problem to Intel in the near future, because AI is currently driving the market, and Nvidia has AI. This has led the company to unprecedented valuations. Intel must have a stronger position in AI and robotics. This includes autonomous vehicles. This AI battle will determine the competitive landscape and Nvidia won’t be easy to catch.
Intel’s latest financial results indicate it will fight harder in the future. It will be difficult to catch up with Nvidia unless it stumbles like Intel.
Wrapping up
Intel’s financial results for Q2 provide a powerful argument to show that the company will be back. This should give OEMs confidence that Intel is capable of delivering.
The company’s AI-focused components will be in full force by next year, with products that are competitive on paper. They could change the game if they continue to operate as they do now. The company will have to face all of the new-generation parts that are available at the time. This fight is not going to be pretty.
The AI wars are not yet decided. Intel is becoming more organized, and this will make the AI wars a fair battle. Nvidia is currently in a big lead, but AI hasn’t reached maturity yet. This means that we are likely to see many changes of leadership until AI matures. Intel’s former glory may be restored by these changes.
Intel’s employees are to be commended for stepping up in a tough time and achieving a crucial quarterly win while facing layoffs, income reductions, etc. After all these difficulties, I thought the company was going to die. It now appears that the company is on a path of recovery.
Intel ARC 770 GPU
Intel sent me A770 & A750 graphics card to test before the end last year. Until recently, I was unable to get them to function. Intel has stopped sending review desktop systems and parts a long time ago. Most of us test now on AMD-based computers. These Intel graphics card don’t work well with the new AMD systems.
If you own an AMD desktop PC, don’t consider these cards. The cards were impressive on an Intel system, and performed better on 3DMark compared to similar-priced cards from AMD and Nvidia.
I found that both cards had very similar performance. This led me to conclude the main reason for choosing one over another would be the appearance. The A770 is lit up in a pleasant blue. This GPU case showcases the card very well.
Intel ARC A770 graphics card (Photo by Author).
In a case that mounts the card flat on the side you can’t really see the lights. The lighted fans, and other features of a GPU card case really make it pop.
In my 3DMark testing, I found that the Intel ARC A770 (438) was on par with Nvidia’s 4060 Ti ($399) but outperformed AMD Radeon’s Radeon Radeon A7600 ($269).
The A750 offers a performance that is similar to the Radeon A7600, and costs about $200 less.
Intel has discontinued the A770 but it still exists available at Amazon. The Intel A750 is available for $219 and does an excellent job of lighting. Shop around for the best price. All of these items are available on Amazon.
The last two weeks I built three AMD systems and one Intel system, and have fallen for the technology. HYTE Y60 GPU Display computer case This case is simple to work with, looks nice when completed and showcases your GPU, which in some ways it does.
I use it as well ID-Cooling Zoomflow The 240X CPU water cooler is a great cooler for the price of $70. You can also adjust the lighting using your motherboard’s lighting controls. MSI boards are easy to use and I prefer them. I build my PCs in the summer. There is nothing better than a PC you built yourself that has a nice glow to it.
In this round of testing I was very impressed with the quietness of all cards. However, if you are looking for the most attractive GPU display, then the Intel A770 is the one to consider.
The Predator BiFrost Card is also a great option, as it costs less and looks better.
