Intel is doing well and would never even have done better than in 2021. According to the results published by the company on January 26, for the fourth quarter, its revenue reached $19.5 billion, up 3% from a year earlier. For the whole of 2021, Intel’s revenues reach $74.7 billion.
Data center activity in great shape
These fine results were obtained despite the 7% drop in its main branch, that of microprocessors, Client Computing Group, to 10.1 billion dollars. In times of chip shortages, the result was expected. The company cannot send as many products as it would like. The laptop computer sector, particularly affected, recorded a 16% drop in income, while the desktop computer sector fared better, with an increase of 19%.
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Fortunately, the “Data Center Group” activity is doing well, with a 20% increase in its turnover, to 7.3 billion dollars. Intel CEO Pat Gelsinger took the opportunity to announce the launch of the next generation of server chips, Sapphire Rapids.
Two other, much smaller Intel subsidiaries are doing well. The Internet of Things Group, as its name suggests, for the Internet of Things, and Mobileye, the autonomous driving branch. The latter posted a turnover of 356 million dollars, up 7% in the 4th quarter. Pat Gelsinger had announced an upcoming IPO of the subsidiary in December. The CEO did not return to the subject.
Intel’s detailed fourth quarter results. Credit: Intel
Intel facing fierce competition
Only one darker point in Intel’s flattering balance sheet, its profits. They fell by 5% over the year, by 21% in the 4th quarter with 4.6 billion dollars. A bad for a good. Pat Gelsinger, who arrived at the head of the company in February 2021, has decided to pursue a massive investment policy.
The American semiconductor manufacturer is being battered by the competition. It has been overtaken by Samsung in the ranking of the largest manufacturers, Apple and AMD are developing computers without its chips, a small revolution, Qualcomm is in ambush…
Pat Gelsinger announced a transition period, a five-year recovery plan, to catch up with the company. Intel will continue to manufacture its own computer and server chips, but, for the record, may manufacture models for other companies.
The CEO expects semiconductor industry sales to double over a decade, from $500 billion to $1 trillion. He takes advantage of the shortage, which should last until 2024 according to him, and the desire for sovereignty over production in Europe and the United States, to grab funding.
Profits sacrificed to investments
The construction of new semiconductor factories remains excessively expensive. Intel announced a plant in Ohio in January for a whopping $20 billion. It must produce its first chips in 2025.
Throughout 2021, investments were announced in Arizona, New Mexico. In Europe, Intel has promised 95 billion dollars of investment over 10 years. Pat Gelsinger has warned that the company’s margins will be affected for 2 to 3 years, for its good?