It’s going to be a rough start of the year for one of the biggest chipmakers in the world, Intel.

About USD8 billion (~Php436.2 billion) in Intel’s market value have been wiped off last Friday after it stumped Wall Streat due to its disappointing earning projections, which also resulted in fears that the PC market is on a slump.

Intel predicted a surprising loss for its first quarter of the year while its revenue forecast is USD3 billion lower than the estimates. It is said that part of the problem is Intel’s data center business experiencing slowed growth.

The company’s share closed to -6.4% while two of its biggest rivals, AMD and NVIDIA, were 0.3% and 2.8% higher, respectively. Even Intel’s supplier, KLA Corp, suffered a -6.9% loss.


This is just one of the many challenges that Intel CEO Pat Gelsinger is facing. Gelsinger is currently trying to reestablish Intel’s dominance in the industry by building new factories in the United States and Europe, as well as expanding its contract manufacturing.

Intel’s move copies AMD’s, who have been steadily stealing market share as it uses contract chipmakers like TSMC.

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“AMD’s Genoa and Bergamo (data center) chips have a strong price-performance advantage compared to Intel’s Sapphire Rapids processors, which should drive further AMD share gains,” analyst Matt Wegner said.

Intel was able to generate USD7.7 billion from operations in Q4 and paid dividends of USD1.5 billion (~Php81.8 billion). For 2023, the company plans to cut USD3 billion (~Php163.6) in costs.

Analysts said that Intel should try cutting its dividend as its capital expenditure for 2023 is expected to be around USD20 billion (~Php1.09 trillion).

Source: Reuters

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