Intel Corporation (NASDAQ:INTC) Management reveals 5 things

Intel Corporation (NASDAQ:INTC) Management reveals 5 things

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Intel Corporation (NASDAQ:INTC) shares have flown nearly 30% over a year, fueled by vigorous growth in its PC and server businesses. Let’s briefly take a look at five statements CEO Brian Krzanich made during the company’s fourth quarter earnings call:

Intel, respectively, controls 82% and 90% of the desktop and notebook processor markets (IDC, 3Q14), whose anemic growth should have weighed down its earnings. That growth also surprised Krzanich, who stated:

“In the PC Client Group, our goal was to stabilize the PC business. We expected revenue to be down by a low single-digit percentage and for operating profit to be roughly flat year-over-year. Instead, the year closed with a 4% increase in revenue and a 25% increase in operating profit.”

Intel’sBroadwell family includes the low-power, fanless Core M processors and beefier fifth generation Broadwell U (Celeron, Pentium, Core i3/i5/i7) processors. Speaking of the development of Broadwell chips, Krzanich stated:

“The end result is a family of Core M and fifth-generation core processors that are the foundation for the industry’s most compelling new designs. These designs include the thinnest, lightest and most energy efficient notebooks, 2-in-1s, Ultrabooks, Chromebooks and mini PCs.”

Intel also tried to attract mobile partners with steep discounts on Atom chips, co-marketing agreements, and financial assistance in redesigning logic boards.Last year, the mobile division posted a loss of $4.2 billion, up from a loss of $3.1 billion a year earlier.

“In the Mobile and Communications Group, we set a goal to ship into 40 million tablets in 2014. This goal was intended to establish Intel architecture in the marketplace and scale the supply chain and attract developers. I’m pleased to report that we shipped 46 million tablets.”

ARM-based processors are already installed in many Samsung and Android Wear smartwatches, but Intel has been securing wearable partnerships beyond smartwatches as well. Krzanich highlighted these new developments:

“You see us moving quickly to wearables through our growing portfolio of collaborations with world-class fashion and fitness brands, like Fossil, Oakley, Opening Ceremony and SMS Audio, along with our own products like the Basis Peak and the Curie Module, a computer the size of a button.”

Since Intel controls 98% of the global server market, its Data Center business, which accounted for 26% of its 2014 revenue, Krzanich further states:

“We are in a great position to benefit from the build out of the cloud and data analytics as we enter 2015. We expect these trends to drive growth again this year.”

 

 

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