Besieged on all sides, Intel strength remains the datacenter

Besieged on all sides, Intel strength remains the datacenter

Summary: It's one of the few bright lights in their earnings report.

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TOPICS: Data Centers, Intel
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Not a day goes by when some tech pundit, web site, or print publication doesn’t lead with a story on how they believe that the PC is dead. They point to all sorts of reasons why we are entering the post-PC age, and pull statistics, opinions, and prognostications out of the air at will. Regardless of how you feel about this there is one thing that is not strictly opinion and that is following the money. And in Intel’s case, the revenue from the sale of PC-focused components continues what appears to be a long, slow decline.

The assault on the pC is coming from many directions. Users who would once have purchased an inexpensive computer for email and web browsing are often now doing those tasks on their smartphones and tablet computers, two areas where Intel is barely an also-ran. And they are directly impacted by the slowdown in PC sales.  Annual revenue for the PC Client Group is down 3 percent year-to-year, with the last quarter of 2012 being down 6%.  Revenue targets are being met, but this is only indicative that the slowdown in sales has been expected.

The bright spot for Intel once again is in their datacenter sales, where they were up 6% year-to-year, a growth rate that continues to climb as sales in the datacenter market continue to grow. There is little doubt that Intel will continue to grow revenue with their datacenter group, as the efforts by non-X86 CPUs in this space are still very specialized and limited in scope.

Intel can’t drive their entire business through their datacenter market growth; they will still need to become a much more significant player in mobile devices and in whatever technologies the future will bring. But strong datacenter sales reflect the overall growth of the datacenter market, and further adoption of cloud and collaborative technologies will see the strength of this market space continue to climb.

Topics: Data Centers, Intel

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4 comments
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  • No Way !

    While I'm very late to the smartphone/tablet world, I'm not okay with the idea that Intel will be relegated to the data center. The economy is still bad and surveys reflect this reality, where people have to limit their device choices. When things pick up, consumers across the spectrum will begin to buy more. In an improved economy, I believe only a modest minority will choose to have *only* a smartphone, tablet, or phablet. When budgets allow, I'm certain the overwhelming majority will choose two or more devices, ie. desktop/laptop, smartphone *and* maybe a tablet.
    The-Jetman
    • Re: I'm not okay with the idea that Intel will be relegated to the data cen

      While your loyalty is touching, it's also futile. Intel is a corporation, not a human being: it doesn't have feelings, or a soul. It exists solely to make money for its shareholders. As soon as that stops happening, they will go elsewhere.
      ldo17
  • Intel etc.

    I have yet to find anyone who creates proper work, whether data, manuscript or creative, use anything smaller than a laptop and - many still use large screen desktops. As long as this need continues, Intel type processors will be needed. In toytown, toys are good enough - in the real world they're, well, just toys for boys.
    bobcglewis
  • Intel = Power-hungry

    As long as Microsoft had the majority of OS based devices, Intel was sitting pretty. Now that ARM has taken over the vast majority of the mobile world, even Microsoft has written Windows (RT) for ARM. With increasing energy costs and slow recovery from the recession, data centres may well start looking at the ultra low (electric) power high performance ARM as a saviour on 2 fronts because once the processor stops gobbling energy, the need for cooling systems is seriously reduced so changing to ARM is a win-win situation. What I don't understand is why Intel hasn't either switched to making ARM based devices (I understand it owns a significant chunk of ARM shares) or produced its own low power processor to seriously compete with ARM; after all, ARM is only just over 25 years old and Intel has been making processors since the year dot (remember the 4004?). I remember working on the development of the first ARM based desktop computer back in 1987 when it was the fastest desktop computer in the world. An 8MHz ARM was on a par with a 33MHz 80486 in terms of processing power according to a test I ran.
    JohnOfStony