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List of companies which tried and gave up on ARM based server, just to refresh
Broadcom: Abandoned around 2014 after few years
Samsung:Tried and gave up around 2015, despite having own fab and server division and experience designing ARM CPUs for mobile
AMD:None other than Jim Keller started and predicted by 2018 x86 will be overtaken by ARM (check on Anand tech)
Applied Micro: Had a working Silicon (Xgene), and network switch. Fire sale to Microsemi in 2016.There is no support for virtualization for ARM as of today and even with a decent chip ready TODAY, it will take YEARS to optimize the software to get credible performance. Cloud customers don't care and want performance.
Also, what matters in cloud is TCO, not the purchase price of x86 (which is higher for Intel).
MSFT will design own ARM server chips? Software compatibility, optimization for AI and other workloads will take years!
Remember MSFT also had a big plan in mid 2000s to launch BING to beat google!
Chances of MSFT succeeding are very slim.
May be it's a PR retribution for Intel joining consortium to make chrome more widespread in enterprises.
Who wants to bet money on MSFT succeeding in hardware design, I am curious to know?
May be clueless analysts of Wall St.
W
Taiwanese chip packager, King Yuan Electronics, will stop production for two days from today after several employees contracted COVID-19 amid rising cases in the global chip hub,Reuters reports.
The rising cases have triggered concerns about the worsening of the semiconductor chip crisis that has hampered global industry ranging from auto to electronics.
Intel Corp(NASDAQ:INTC) andSamsung Electronics Co Ltd(OTC:SSNLF) feature amongst King Yuan’s essential customers.
The halt is estimated to affect 4% - 6% of its June output and up to 6% of its June revenue. King Yuan saw no significant business impact in 2021." Not great news, but should allow for a decent dip for those looking for an entry point.
s
Hmm, Amazon and Intel each generate profits of about $20B per year. Amazon market cap ~ $1.8T. Intel market cap only ~ $200B (one-ninth Amazon). Sure the naysayers will claim Intel isn't growing. Fact is Intel is growing (albeit slow and steady). Intel makes more profit than AMD, Nvidia, Tesla, GM, Ford, and Netflix combined. Intel is pumping its profits into regaining tech leadership and USA mfr. Even with massive investments eating into their margins, Intel's margins will be 51-53%. AMD is hoping to get their margins up to 50% in five years. Nothing against AMD, just saying Intel is a better value, especially when Intel is beaten down like this.
e
On Microsoft's ARM story, the timing of the 'sources of Bloomberg' was very suspicious. It seemed every time Intel got some momentum and about the break out there was some 'suspicious' news intentionally brought it down. Similar example was on Dec 7th where some old news about Apple working on in-house Mac silicon. This time:
- there was no fact, just rumor
- Amazon has been doing it for years yet Intel still has 90%+ server CPU share
- Microsoft has been trying ARM for years with little success, if any stock would be impact it should have been QCOM more than Intel.
- AMD is baked in to the idea of stealing server market share but was fine with this rumor
- Even if it's true, it would take years for Microsoft to make some real progress, by the time, Intel should have gained significant share in other server XPU market including GPU, ADAS, FPGA.So this rumor is more about intentionally spreading bad news for Intel rather than actual impact on the top line.
So
D
INTC is one of the very few undervalued or properly priced stocks available.
L
As per EETimes report, emerging memories will replace DRAM and NAND by 2030 and will be $44bn market out of which $20bn will be 3D Xpoint (Optane) memory, an Intel monopoly.
Even assuming 80% market share there and healthy 50% margin, that's another $8bn in gross profits or 40% of total as of today, just by tiny memory division. Add GPU, 5G, IoT, Mobileye (exploding), FPGAs and IFS, there is immense potential for surge in profits along with CPUs.https://www.eetimes.com/emerging-memories-look-to-displace-nor-sram/
A
I may not understand new wave investment styles, but I do know $5.44 eps beats $0.51 eps. Others can fantasize about what their dream company is going to do in the future, and that is fine, it is good to dream, but I will stick with proven financials and forgo the pie in the sky expectations. When intel’s earnings start to decline and other companies start to pony up with solid returns, I will gladly look at those other companies. Do not get me wrong. AMD may be a great company with a great future, but for now, they are way overvalued, and Intel is way undervalued. Too much downside potential for AMD and some good upside potential for Intel.
H
11.28 PE and Intel will probably have blowout earnings as always. Intel is most consistent company, but never gets respect it deserves. Good stock for young long term investor. My average cost is $22.44
g
$AMD conversation
*** Server super replacement cycle is coming in the first half of 2021 ***
I have been waiting to see if anybody, Wall Streets or Main Street seen this coming, which doesn’t look like it. I even dropped a hint more than a month ago when I wrote a long piece in $INTC and AMD boards, about Intel’s buyback and its financial engineering, and I flagged that sentence as well (check my history post).
So, what’s with this all about? This is an echo boom from 2018, the Spectre and Meltdown vulnerabilities induced panic buying.
When Intel revealed the vulnerability back in January 2018, Intel’s stock immediately took a hit. People even accused the ex-CEO Brian Krzanich sold his stocks prior to this, as Intel sat on the information for 6 months (informed by Google) before making it public.
I knew it then that Intel was toast, but not immediately. That’s why I started buying AMD shares in larger quantity and accumulating them for the long haul (average price below $12). Although the launch of Ryzen and EPYC were exciting, this is the break that AMD needed to make meaningful server market share gain down the road.
To mitigate the HARDWARE vulnerabilities, the system firmware needed to be patched. But the patching would cause a performance hit of 10% to 30%, and that’s a big deal. A properly sized server should have 50-70% CPU utilization at most time, below that is a waste of idle resources, above that could mean it may not be able to handle sudden spike of work demand. Servers’ statistics are being monitored and logged 24x7, among them are CPU utilization for abnormal activities and capacity planning. Each server would have customized threshold to be considered normal operation, exceeding that, warning or critical alarms would go out to operation personnel to investigate and take action if necessary. For example, a warning would go out if all CPUs in a server is running at 80+% for 2 hours, or a critical alert if they have been at 100% for more than 15 minutes, etc. Now, imagine how many alarms would be tripped after a server have been patched, Intel that own 99% of the server market share at the time had just made a bunch of enemies with people that run the datacenters. But the payback would be later.
For the immediate aftermath, Intel made it out like a bandit, they had huge earning beat for the next 2 quarters (look at the chart, 35% gain in 6 months) while the expectation was people would flee from buying Intel servers. Like it or not, you can’t just buy AMD servers to augment the Intel servers, it would take time to test everything before it could be rolled out to production. Yes, they are both x86 based, but underneath there are differences, like device drivers, libraries, kernel tuning and etc. Short term solution was to buy similar if not identical Intel servers to increase capacity, causing huge shortages as reported by Intel, remember those days?
Fast forward 3 years. Those extra servers will reach their “end of life” starting 2021. Unlike consumer PCs/laptops, people will keep using them as long as they meet their needs. I am still using one of my laptops that is 8 years old, although it was a top of the line Intel i7 when I bought it.
However, a server useful life is 3 maybe up to 5 years. There is a reason for the 3 years magic number. A new server typically comes with 1 year warranty, and the vendors will throw in 2 more years of extended warranty for a relatively small and attractive fees if agreed upon upfront. Servers hardly have any hardware issue in the first 3 years so it is extra income for them. 4th year on out, the service and maintenance fees increase substantially, and by how fast technology improve nowadays, it could be considered obsolete after 3 years anyway. On top of that, the finance and accounting people love that 3 years magic number too. It is a known fix cost that can be budgeted and depreciated over the useful life of the servers, simple math and everyone is happy.
After 3 years, whoever wants to migrate to AMD should have enough time to test out the development life cycle, if they are inclined to do so. This will be one of the larger if not the largest PREDICTABLE server replacement cycle in the history, Y2K was the other one. In fact, this is so predictable, that the front end purchase orders should start trickle in by now to beat the rush that caught everyone by surprise almost 3 years ago.
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Analysts needed time to warm up to intel again. But before they could do that, they needed a reason. With yesterdays announcements, they now have 4 reasons to reconsider their positions on Intel. In today's world, the bottom line doesn't matter anymore. We see that with many stock making new high who have never made a profit. What really matters for analysts are the possibilities of future wealth gained through hypeing one stock, or one industry, over another. The fuel for that hypeing is information. In the past it was all negative information from intel. Now it's one technological breakthrough after another. These announcements are the sports drink thristy analysts were waiting for. Insiders will be quietly loading up on Intel before analysts come out with their revisions upward for Intel. This is just the beginning.
D
Of all the boards I monitor and post on this one is by far the best. I learn from and enjoy the information shared on this board! Someone mentioned that Lisa Su stated that there is room in the market for both Intel and AMD. At present AMD is winning the performance battle for GPU's for data centers. I believe the competition is good to drive the technology. With all of that said I believe that we are currently in a golden age of technolgy and semiconductors are the DNA. There is a much bigger picture than competition for the data center. AI, 5G, self driving cars, gene sequencing are just a few of the emerging technologies all requiring semiconductors. I saw an article where semiconductor growth is projected to be $90.8 billion between 2020 and 2024. Intel (and TSMC and most likely Samsung) are building capacity to support and it will be in high demand. Intel has a strong balance sheet and PE under 12. It is well positioned to add capacity and I believe utilize some of TSMC's high tech capacity in future. Looking to the future Intel is well positioned to survive and prosper even if they don't win the performance battle with AMD for the data center. Intel and AMD are national resources!! And, given Intel's renewed focus on technology coupled with their financial strength their stock price should be up with the likes of NVDA, AMD et al!!!
r
While INTC is very slow to reward shareholders with capital gains, there is no doubt that those who are patient will be rewarded if they wait long enough. INTC is very cheap on all metrics. 10.84 PE trailing twelve months, 9.22% earnings yield, EV/EBITDA 6.81, EV/free cash flow 12.53, free cash flow yield 7.90%. No way to argue, this stock is a bargain. Only question how long will you be waiting for that return, and is the dividend adequate compensation enough to pay you to wait? These are the things an investor needs to take into account with stocks like INTC. The future itself appears quite bright to me so ultimately I am willing to be patient. I like AMD and NVDA too though. I think all have something to offer. You just have to decide if you prefer quick returns or slow ones, as well as how much risk you're willing to take to get those returns. Compared to AMD and NVDA I see INTC as being low risk. All things to consider when investing. The risk/reward scenario is very important.
J
One of Intel's Mobileye partners in China, NIO, appears to be a bigger deal than Tesla in their own market. Mobileye has an opportunity there to hit it big. Intel has sunk a lot of money into filling out a complete package for Mobileye to sell... crowd source map creation, low cost sensor chips, funds and technology for eyeq5 and eyeq6 development, ride scheduling integration.
J
The market is realizing that Pat Gelsinger cannot turn the INTC ship overnight. The latest delay in Sapphire Rapids will allow $AMD to continue taking share of the data center market in 2022. I expect analysts with revise INTC PT down and AMD PT up.
Also, AMD is seeing lots of positive news on XLNX acquisition and the NEW GPU for cell phones. INTC is a value trap. Sell ASAP and redeploy into $AMD.
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Intel is selling all the stakes in non core business and bringing the focus on building Fabs and more competition into technology development . This should be good news for InTc shareholders , I am share holder of Cloudera which was owned 8% + by intc . Intel sold its stake at a loss but to focus on core business , I think Intel is right about building capacity for Memory storage for Server and cloud computing , making edge tech in autonomous vehicle , AI, GPUs, Quantum and super computers . Peter Lynch once said if you don’t understand what you own you should I not own it . The share doesn’t know you own them . Intc is the diamond in dirt . It needs little polishing and boom a trillion $ company . Competition bring enthusiasm and I think Intel will beat every one including Apple and Microsoft in chip tech . I also own Microsoft .
C
Dream entry point here. Earnings were solid. Everyone knew the infrastructure investment was going to cost money. Intel has signed AWS and Qualcomm for foundry services. Alder Lake CPU releasing soon with price and performance that stomps AMD to be blunt. MobileEye business growing much quicker than expected. Future looks bright, and the stock in on sale.
R
Some of the talk in the Yahoo video with the Wedbush analyst touched on Intel losing market share to firms now "making" their own chips, i.e. Apple and Amazon. I don't hear that they are actually "making" them. They are sending them to Taiwan Semi to have them made because only TSM (and maybe Samsung) has the fab processes capable of making the chips Apple, Amazon, Qualcomm, AMD, Tesla, etc are designing.
So although Intel Server and Desktop CPU's designs are now being pressured by AMD technologically, I suspect that the ability of TSM to service AMD and all of these other customers will be the bottleneck that saves Intel from meaningful AMD competition.
Also, Intel's strategy of providing fab services to companies like QCOM, AMZN and others is absolutely the right approach, since fab capacity seems to be the issue here.
Now the main issue that INTC investors have to face is how quickly can Intel execute on bringing their new fab processes into production at decent yields as well as simultaneously building new fab capacity. Thank goodness they now have an engineer in charge, and not a CPA, lawyer or salesman running the firm! Pat just has to execute (not a small task).
e
Bob's purchasing INTC shares before leaving INTC says SOMETHING. I believe INTC will announce a breakthrough in 7 nm manufacturing in the next CC. Keep it in mind that Intel keeps Investing in 5nm, 3nm chip manufacturing technologies. The NEW CEO, a technical guy, will help INTC gain chip manufacturing process superiority. It is a matter of time!!!
J
Here is what ClearBridge Investments Dividend Strategy has to say about Intel Corporation (NASDAQ:INTC) in its Q1 2022 investor letter:"In the early days of the invasion, we made two measured changes to the portfolio based on longer-term fallout we anticipate from Russia?s invasion of Ukraine. We initiated a position in Intel (NASDAQ:INTC).Over the last year, Pat Gelsinger, Intel?s new CEO, has devised a bold and aggressive strategy shift for the company. Gelsinger wants to open Intel?s factories to manufacture chips for competitors and thereby increase the utilization of Intel?s machinery. Doing so could increase the company?s returns and profits and bolster its competitive moat. While we admired these moves and saw their potential merit, we sat on the sidelines.Intel?s repositioning requires tens of billions of dollars of increased investment and entails more risk than we are usually comfortable with. Russia?s invasion of Ukraine, however, changed our calculus. It revealed the fragility of the international order and drove home the importance of local manufacturing for critical industries like semiconductors.Over several decades Taiwan has become the leading source for cutting-edge computer chips. With China determined to control Taiwan, this poses a critical strategic risk for the U.S. and the West. Concern over this threat has simmered for years but the war in Ukraine marks a boiling point. Indeed, just two weeks after Russia invaded Ukraine, Germany offered Intel over #$%$5 billion in subsidies to build a plant in-country. We expect the U.S. will soon do the same. As Intel embarks on this new course, there is significant, long-term upside potential for the shares. This strategy entails meaningful risks, but at the $45 price we paid for our shares, we believe the risk/reward was asymmetrically skewed in our favor."
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* OneAPI and XPU, AI, software transformation
This is Intel's new 'mega market', challenging NVDIA directly. This market potential is the reason why NVDA is trading at price/sale ~ 22, about 10 times that of Intel. Even NVDA just had a great quarter, but the share dropped. I think smart money already sensed stronger competition in server GPU/AI space.
If Intel executes well in this direction, the valuation could be similar to that of NVDA, which mean pps can fly to the moon, like 5-10 times. Of course, that's just an if.
Mr Market is not yet priced in that mega trend for Intel, once Intel's server GPU has gain some traction we will see.
