Apple M1 Macs kick a hole in Intel client revenue • The Register

Intel has blamed Apple’s move to its own silicon M1 in Macs for declining sales to its client computer group and portends future trouble caused by supply chain problems and the recent Internet crackdown in China.

Chipzilla’s finances were stable for third quarter from its fiscal year: revenue of $ 19.2 billion increased by five percent on an annual basis, while net income of $ 6.8 billion increased by 60 percent compared to the third quarter of 2020.

But revenue for the customer computing group fell by two points. CFO George Davis – whose retirement was announced today – was trying to point out that if Apple did not leave Intel silicon and Chipzilla left the modem business, customer revenue would increase by ten percent.

Davis predicts another shock from declining demand from China. CEO Pat Gelsinger told investors that as a result of the recent crackdown on games in China, “all cloud service providers are adjusting their proposals to meet this new regulatory environment, so we expect there to be a quarter or two to find out what they would look like “

Gelsinger predicts that clouds in China will return to their Xeon paths. “We expect a good recovery in this business area for us and we expect that next year there will be a return to normal in this area of ​​our business,” he said.

All clouds in China are adapting to the new regulatory environment

So far, Intel’s data center group is doing well. Quarterly revenue of $ 6.5 billion rose ten percent year-over-year, and one million third-generation Xeons have been sold since April, with another million expected to sell in the fourth quarter. The contractors said Intel’s next data center architecture, Sapphire Lake, will debut in the first quarter of 2022 and provide additional momentum.

The performers were also very tuned to Alder Lake’s customer architecture – Intel’s first attempt to mix matrix core types – which appears to be the subject of an event the company will host next week.

Computer makers, Davis said, are already focusing on higher-end Intel customer products. Because Alder Lake’s ability to map workloads to major types can only be controlled by Windows 11 at the time of writing, Intel executives expect a good boost from Microsoft’s new OS.

Supply chain constraints continue to increase. Gelsinger said the lack of power and a network adapter is halting server sales.

“We would have delivered many more units… if we had not been limited by the supply chain of these other components,” he complains.

Investors were told that supply chains were improving and that Intel’s various efforts to improve production efficiency and build new facilities were helping to address the problem in both the short and long term.

But when Davis offered financial guidance, he projected “revenue in 2022 of at least $ 74 billion despite continued supply constraints.”

“As supply normalizes and our investments increase capacity and drive market-leading products, we expect our revenue growth to accelerate to ten percent to 12 percent CAGR over the next four to five years,” he added.

To get there, Intel has to spend heaps of cash. Forecasts predicted that capital expenditures for next year would fall between $ 25 billion and $ 28 billion.

Gelsinger felt confident that Intel could achieve.

“The company is working well,” he said. “We are confident in our technological technologies and product roadmaps. Our business is strong and our markets remain strong. And above all, we are carrying out our plan. ”But the plan is young – Gelsinger won the big chair only in February 2021 – and Intel has significant obstacles in its path. Think of years of factory construction, another big customer-Alibaba-launches its own hand-powered silicon, increasingly confident AMD, growing interest in RISC-V for all devices and other competitors such as TSMC, which are making their own investments to meet growing silicon demand.

Confidence is one … ®

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