The world's largest chip-maker,
), hosted its Analyst Day on Nov 21, 2013, following which shares
of the company were up 2.7% and closed at $25.23.
During the course of the event, management stated that expansion
of its small contract manufacturing business will prove to be a
major factor in driving long-term growth. Until recently, Intel
had used its manufacturing capabilities to manufacture its own
However, this year, it signed up a couple of foundry customers
and management now plans to open up for competitors as well. So
Intel could now be making components even for its companies like
) and mobile chipmaker
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Intel launched two mobile chips from its Atom line with the
high-end version named Broxton and the low-end version named
SoFIA. These chips have been designed in such a way that they can
easily interchange features and thus create different versions of
the same component.
Management has shifted its focus toward low-priced categories.
Considering the sluggishness in the PC market, this seems to be a
good move to grab market share. As a part of its new growth
agenda, Intel will focus on manufacturing chips for a few phone
makers but with large sales volumes.
Intel intends to become more customer-centric in the near future,
which means that it will manufacture chips keeping market demand
in mind rather than trying to push its own designs.
The company's focus on geographic expansion and addition of new
customers to its existing sphere of businesses will help
accelerate profit growth in the future.
Intel expects revenues to remain approximately flat year over
year in 2014. Gross margin is expected to be within 55% to 65%.
Intel predicts the PC market to be down in low single-digit
percent in the near future. Investments to help customers convert
to Intel chips in tablets are expected to adversely impact
Management targets 15% compound annual growth rate (CAGR) for DCG
(Data Center Group) by 2015, which will be brought about by an 8%
CAGR in Enterprise IT and a much higher and more rapid rate of
growth in emerging areas like private cloud, telecommunications
Currently, Intel has a Zacks Rank #3 (Hold).
Microchip Technology Inc
) with a Zacks Rank #2 (Buy) also provide an attractive solution