Intel Corporation posted revenue of $14.8 billion (+8 percent), operating income of $3.6 billion (+40 percent) and net income of $3 billion (+40 percent) in the first quarter of 2017.
The result of Intel in Q1 2017 indicates that Intel is not relying on growth in PC business and processors for server sector.
“The first quarter was another record quarter, coming off a record 2016. We continued to grow our company, shipped our disruptive new Optane memory technology, and positioned Intel to lead in new areas like artificial intelligence and autonomous driving,” said Intel CEO Brian Krzanich.
Intel business in Q1
# Client Computing Group revenue of $8 billion (+6 percent)
# Data Center Group revenue of $4.2 billion (+6 percent)
# Internet of Things Group revenue of $721 million (+11 percent)
# Non-Volatile Memory Solutions Group revenue of $866 million (+55 percent)
# Intel Security Group revenue of $534 million (–1 percent)
# Programmable Solutions Group revenue of $425 million (+18 percent)
Intel’s traditional businesses, Client Computing and Data Center, defied market trends with growth of 6 percent and 6 percent to $8 billion and $4.2 billion, respectively, said Technology Business Review in a recent note.
The chipmaker’s gains of 11 percent in IoT, 55 percent in Non-Volatile Memory Solutions group, and 18 percent in Programmable Solutions Group showed that while the processor remains Intel’s core business, Intel is scaffolding its PC and data center processors with continued investments in new markets.
Daniel Callahan, analyst at TBR, observed that Intel leadership observes AI as an opportunity to deliver both software and silicon that enables AI-driven products and services. Intel has the potential to benefit from those direct component sales and indirectly through data center and cloud server sales as well as data capacity needs increase.
This strategy isn’t without risk for Intel. Intel will have to divert significant R&D, M&A, and S&M into developing its AI go-to-market and selling the entire market on it. This would be a surer bet if other major companies weren’t delivering competition, with the same conviction, to Intel’s end-goal: Google, IBM, Microsoft, AMD and NVIDIA to name a few.
