Intel revenue up 10% aided by Client Computing business

Intel revenue in Q4 2016Intel reported revenue of $16.4 billion (+10 percent) in Q4 2016 and $59.4 billion (+7 percent) in 2016 fuelled by growth in Client Computing business.

ALSO READ: Intel revenue in Q4 2016

“The fourth quarter was a terrific finish to a record-setting and transformative year for Intel. In 2016, we took important steps to accelerate our strategy and refocus our resources while also launching exciting new products, successfully integrating Altera, and investing in growth opportunities,” said Brian Krzanich, Intel CEO.

Intel in 2016

Client Computing Group revenue of $32.9 billion (+2 percent)
Data Center Group revenue of $17.2 billion (+8 percent)
Internet of Things Group revenue of $2.6 billion (+15 percent)
Non-Volatile Memory Solution Group revenue of $2.6 billion (–1 percent)
Intel Security Group revenue of $2.2 billion (+9 percent)
Programmable Solutions Group revenue of $1.7 billion

Intel in Q4

Client Computing Group revenue of $9.1 billion (+4 percent)
Data Center Group revenue of $4.7 billion (+8 percent)
Internet of Things Group revenue of $726 million (+16 percent)
Non-Volatile Memory Solution Group revenue of $816 million (+25 percent)
Intel Security Group revenue of $550 million (+7 percent)
Programmable Solutions Group revenue $420 million

The increase in Q4 revenue of Intel marked two quarters of growth after a 1.2 percent drop in Q2 2016.

The chipmaker’s double-digit gains of 16.2 percent in Internet of Things (IoT) and 24.8 percent in the Non-Volatile Memory Solutions group showed that, while the processor remains Intel’s core business, Intel will methodically expand its ability to serve new markets. “It will do so by scaffolding its processors with continued investments in new markets,” said Daniel Callahan, analyst at TBR.

Intel revenue analysis by TBR

TBR said Intel will continue developing and refining its traditional data center-oriented technologies, such as software-defined computing, to support its Data Center Group (DCG) in offering the back-end processing capabilities to serve these new markets.

Intel’s operating margin declined 120 basis points due, in most part, to a 5.2 percent increase year-to-year in R&D expenses, expected with Intel’s effort to buttress its existing portfolio as well as developing emerging technology.

Intel will remain a silicon company pushing the limits of processor performance per watt to meet modern device requirements.

The company is leveraging its PC and data center processor strengths to bankroll its investments in emerging opportunities, such as autonomous vehicles and IoT, supported by investments in 5G, machine learning, FPGAs, VR, silicon photonics, and its underlying silicon expertise. The result is Intel’s new positioning as an enabler of technology that partners and customers alike can leverage to solve business problems.

As PC and server chip sales have slowed, Intel has refocused its business towards IoT and related technologies, such as 5G, delivered into products that are more vertical or market-oriented.

Intel is increasing investments in vertical-specific IoT applications. Intel’s Responsive Retail Platform and creation of a $100 million investment fund will support developing product for the retail vertical. The platform will act as a retail solution hub to support development of IoT solutions for retail vertical problems and exploration of machine learning AR/VR, and robotics for retail use cases.

Baburajan K
[email protected]

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