Kozminski Techblog

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Recently Wall Street has been sending some signals indicating the end of Intel as the leader of the US chip market. And if these signals come to fruition, this might indicate the end of Intel’s leadership of four decades very soon.

Qualcomm, a chip manufacturer , has seen its stock market value increase by nearly half since October , crossing Intel last week. AMD , another one of Intel’s competition in PC and server processors , has seen similar growth and is nearly about to cross its longtime opponent.

This is coming after Nvidia , the primary manufacturer whose chips provide computing power for machine learning , artificial intelligence , video gaming and supercomputing leapt past intel early last year. Currently Nvidia’s stock has risen 60 percent from October and is almost 4 times the size of Intel’s.

Meanwhile , Intel’s shares have dropped in value even after an attempt by Pat Gelsinger , Intel’s new chief, to reassure battered investors fell short. Intel’s troubles have been widely known , missing the smartphone market , losing its lead in chip manufacturing technology to TSMC and now losing its dominance in the PC and server processing market.

But this recent shift is a rather new one. Wall Street no longer believes that Intel’s edge which used to be its unrivalled technology, operational excellence and financial excellence are no longer enough to bring back the growth in double digits which it has not seen in a decade and half.

On the other hand , AMD’s growth has been the most startling. After an all-time low of USD$2BN in the middle of 2010’s , its market value has now surged to USD$190BN after a radical tech overhaul which made its processors more competitive and more affordable for users.

Things do not look good for Intel, even after their announcement of their Sapphire Rapids line of processors which are based around chiplets. Even though it’s a unique concept , it may not be enough to give Intel the edge it seeks. AMD has already announced its newer Zen architecture which is more dense and more powerful in computing than its current generation which already puts up a brave fight for itself against Intel.

So what does this translate to ? This means that in the near future we could see an end to Intel’s era of excellence where Intel was the first choice in many different departments but due to a failure to keep up and adapt with the times it may be too late. Unless Pat Gelsinger can get his managers together and right the ship, Intel may be looking at becoming an option instead of a choice when it comes to the US Chip Market.


Sources :
https://www.ft.com/content/f970d7b7-09b8-4d5a-b946-f024f1845bc0

https://www.wsj.com/market-data/quotes/INTC,NVDA,TXN/research-ratings

https://www.cnbc.com/2021/11/17/investing-club-why-nvidias-incredible-growth-story-is-still-in-its-very-early-innings.html