Intel continued its topsy-turvy 2020 by reporting stronger demand for its Tiger Lake CPUs than the company originally anticipated, even with an increase in its manufacturing capacity. However, the company’s profits and revenues declined.
Intel said that the company now expects 100 notebooks based upon the 11th-gen Tiger Lake processor will ship by the end of the year, with about 150 in all if 2021 is included. Those 100 Tiger Lake notebooks doubled Intel’s original April expectations, executives said. About 40 of those notebooks will be qualified under the new Evo brand, the evolution of the “Project Athena” program.
Intel also said that it now has three 10nm manufacturing fabs up and running, and that the company expected to ship 30 percent more chips at the 10nm manufacturing node than originally expected.
“Tiger Lake is exceeding expectations,” George Davis, Intel’s chief financial officer, said.
Intel still recorded lower profits and revenue than a year ago. Third-quarter 2020 profits slid 29 percent to $4.3 billion, and revenue was down 4 percent to $18.3 billion. Intel executives had previously explained that they continued to expect higher profits and revenue in the first half of the year versus the second, consistent with the effects of the pandemic.
“2020 has been the most challenging year in my career,” chief executive Bob Swan said during a conference call with analysts,
As consumers continued to work from home, notebook PC revenue soared, up 16 percent compared to a year ago. Desktop revenue fell by the same amount. In total, PC volumes climbed by 11 percent, and the company’s Client Computing Group revenue increased by just 1 percent to $9.8 billion.
Intel’s Data Center Group revenue fell by 7 percent to $5.9 billion. Cloud revenue increased 15 percent, but sales to the enterprise and government sector fell by a whopping 47 percent as the market began to “digest” recent purchases, Intel executives said.
Intel executives didn’t spend much time talking about SK Hynix, which said it intends to buy Intel’s flash and SSD business in a $9 billion deal that will take several years to complete. Davis described Intel’s flash business as a “non-strategic asset” that Intel was selling to focus on more core opportunities ahead.