Intel's Q2: Meh

[jpiniero]

Kind of meh. They made slightly more versus Q2 2015 but the income was less because of the layoff costs.

This is what you really need to know:

Q2 2016 compared to Q2 2015 :
- Notebook platform volumes decreased 5%
- Notebook platform average selling prices increased 2%
- Desktop platform volumes decreased 7%
- Desktop platform average selling prices increased 1%
- Tablet platform volumes of 5 million units decreased 49%

First six months of 2016 compared to the first six months of 2015:

- Notebook platform volumes decreased 4%
- Notebook platform average selling prices increased 1%
- Desktop platform volumes decreased 5%
- Desktop platform average selling prices increased 4%
- Tablet platform volumes of 9 million units decreased 47%

 

[NTMBK]

Those tablet drops D:

 

[FIVR]

It's ok guys, they can still have increasing profits and share price. They will just monetize their work force again! 3,000 more layoffs will pull easily 300M out of payroll and heck, they can sell a few building to reduce liabilities. A little snip there, a little snap there and bada-bing bada-boomb we've got half-percent dividends on the side!

This is intel were taking about, people. Even when they lose; They win.

 

[senseamp]

Intel has been all about promoting the idea that performance is good enough, just need to reduce power, integrate more on die, and stick it into smaller form factor. Now, the good-enough chickens are coming home to roost.

 

[dark zero]

- Tablet platform volumes of 5 million units decreased 49%

Atom is dead definately... and how about mobile?

Intel had the misfortune to not to sell in LATAM or Asia as they wanted... SoFIA wasn't supposed to be existed, but Broxton... why Intel killed Broxton if that could be really a good SoC? That was the worst move from them in years... and few months later ARM is bought by Softbank which seems that doesn't know what to do with Mobile...

 

[VirtualLarry]

Those tablet drops D:

I guess that's what happens when you stop giving the chips away. (End of "Contra Revenue".)

So much for under-$100 Windows tablets. Were they just a fad, or was it not worth it to grow that market, with better-specced (2GB/32GB *minimum*) tablets? I suppose Intel cancelling WillowTrail didn't help much.

But if their chip sales into that market declined that much, I can understand Intel dropping that product line.

Edit: Would be nice to be able to gain some perspective on these numbers. Are ARM/Android-based tablets also down nearly 50% in sales volume?

IOW, is it just the overall market, or is it Intel.

 

[frozentundra123456]

Laptops/convertibles are eating into them from one side and smartphones from the other. My family (younger members especially) seem to think smartphones are great for surfing the web, online purchases, banking, texting, social apps, etc. So that kind of eliminates the need for a tablet. Personally I still find a 7 or 8 inch tablet much easier to use than a smartphone, but the disadvantage is you have to have a wi-fi connection, at least with the cheaper tablets.

 

[bhtooefr]

Keep in mind that there's literal 7" smartphones out there - they're not common, but they exist.

And, when 6" smartphones aren't uncommon, a 7" tablet makes less sense.

 

[arandomguy]

Edit: Would be nice to be able to gain some perspective on these numbers. Are ARM/Android-based tablets also down nearly 50% in sales volume?

IOW, is it just the overall market, or is it Intel.

Overall tablet market has been on the decline several years now but Intel's relative drop is much greatly outpacing that.

http://www.pcmag.com/news/344954/report-predicts-weaker-smartphone-tablet-sales

 

[nerp]

You think Intel's tablet chips sales are down? Take a look at Apple's iPad sales. Good luck finding the bottom of that well.

These Intel results are not surprising. They've been gearing us up for these exact results for months.

 

[Arachnotronic]

On the call they said enthusiast CPUs continued to grow at double digits and 6950X selling far better than expected, just FYI.

 

[Arachnotronic]

Those tablet drops D:

Yep, Intel is out of the tablet market. Expect that number to eventually go to zero.

 

[cytg111]

On the call they said enthusiast CPUs continued to grow at double digits and 6950X selling far better than expected, just FYI.

They sold one? j/k .

 

[kupuijo]

Yep, Intel is out of the tablet market. Expect that number to eventually go to zero.

can you show me market it?

 

[positivedoppler]

They sold one? j/k .

Wonder how many people in IT or is a developer just run it through their company's corporate card lol. I sure wouldn't mind if given the chance.

 

[poofyhairguy]

On the call they said enthusiast CPUs continued to grow at double digits

What is an enthusiast cpu? K series? X99?

 

[Arachnotronic]

What is an enthusiast cpu? K series? X99?

K-series + X-series.

 

[poofyhairguy]

K-series + X-series.

Oh. Thanks.

 

[sm625]

Non-GAAP is King. Multiple expansion is Queen. Nothing else matters. I cant wait until they start taking actual quarterly losses and start turning those into non-GAAP earnings beats. Oh, wait, some companies are already doing that.

 

[AtenRa]

Intel destroyed any chance x86 had in Tablets for themselves, AMD and Micosoft (Windows). That anti competitive Contra-Revenue "maneuver" alarmed ARM manufacturers that responded with lower prices (price war) that Intel was not able to sustain indefinitely (Billions of losses year after year had an impact at shareholders). It was a bad bad bad move from Intel that will haunt them for years (3 years cadence etc).

Anyone knows what is the 2.2B in operating loss ??

 

[aigomorla]

Intel destroyed any chance x86 had in Tablets for themselves, AMD and Micosoft (Windows). That anti competitive Contra-Revenue "maneuver" alarmed ARM manufacturers that responded with lower prices (price war) that Intel was not able to sustain indefinitely (Billions of losses year after year had an impact at shareholders). It was a bad bad bad move from Intel that will haunt them for years (3 years cadence etc).

+1 to this....

absolutely stupid move by intel which lead ARM to run rampant.
And yes, it is something that they will regret because intel totally had the chance / opportunity to decimate this sector before the ARM guys got big.

 

[jpiniero]

Anyone knows what is the 2.2B in operating loss ??

Most of it is probably costs from the layoffs I presume. Severance, etc.

 

[nerp]

ARM tablets aren't selling, either. Tablets are not growing. Doesn't matter who was in the game. They all are getting killed here.

 

[Roland00Address]

How is Intel supposed to compete with this hardware specs for $99

6.0" Screen
1920x1080 IPS
Corning's Gorilla Glass 3

4x Cortex A53 @1.5 ghz+4x Cortex A53 @1.0 ghz
2 GB of Ram

32GB Storage+Micro SD up to 256 GB
13.0" Megapixel Camera+LED Flash

Android 6
LTE+HSPA, with LTE Bands 2, 4, 12 (T-Mobile Bands not a suprise since its for MetroPCS a prepaid MVNO that T-Mobile Owns)

Fingerprint Scanner

3400 Mah Battery

USB-C

http://www.gsmarena.com/zte_zmax_pro-8096.php

That is the specs for the ZTE Zmax Pro that will be coming out in two weeks. All of this for $99

Images if you care
http://www.gsmarena.com/zte_zmax_pro-review-1466p2.php

Pretty much the only downside for that phone is that it uses a qualcomm snapdragon 617, but the future versions will probably use a qualcomm snapdragon 650 which trade 4x53+4x53 for 2x72+4x53 cortex arm cpus. Or the qualcomm snapdragon 652 which boots it to 4x72+4x53. This is because the die size of 2x72 is about the same as 4x53, and both the 617 and the 650 and 652 are on 28nm process so they are damn cheap to make.

Now the cortex A53s at 1.5 ghz are not slow, they are not just blazing fast, they are far faster than the Nexus 7 2013. They will be faster than atom x3s, and will compete well with the baytrail cpus. And cortex A72 will blow current baytrail / cherrytrail out of the water. And these are now the type of cpus you will see on $99 android devices. Oh these devices also have 1080p ips screens, 2gbs of ram, and a 6" phablet is close enough in size to compete with the 7" and 8" tablet space.

Intel by contrast wants to keep the 10" and larger devices away from the pure tablets and move those to window convertible devices.

Pretty much ARM is innovating too quickly at too cheap of prices for Intel to compete without doing rock bottom / contrarevenue margins and Intel does not want to do that anymore for they were not making money doing so. The whole goal of contra revenue was a couple things. 1) Deny money to your competitors while at the same time breaking even or losing a little money. 2) Keep fab utilization at near 100%. 3) (Long term goal) Get yourself into the market at rock bottom prices but then offer higher end offerings that people could eventually upsale too. In other words get the OEMs willing to deal with Intel instead of doing ARM and custom ARM socs. 4) Make your real money off server sales for the more devices that use the internet the more internet backbone you will need. In other words use cheap atom as a loss leader where you break even or make a small profit on the devices long term, but sell several thousand dollar cpus to people like google, facebook, etc to support these devices.

Atom goal during the last few years (not the early 2007 atom, but the recent atom) was not to be an insane profit generator all by itself, it was only meant to enable future sells of the profit generators while keeping the really low end cpus in house to deny our competition. Well ARM is the zombie that will not stay down so Intel decided not to waste more bullets trying to kill it, and instead focus more of its effort on a defensive strategy with the goal of wasting less money try to put ARM down.




Put simply that tablet sells are dropping for cheap low end phablets and 5 to 5.5" smart phones are getting so good, and so cheap there is a less need for a tablet.

 

[aigomorla]

Put simply that tablet sells are dropping for cheap low end phablets and 5 to 5.5" smart phones are getting so good, and so cheap there is a less need for a tablet.

Sorry to say but there is absolutely no way my S7 Edge will ever replace my Galaxy Tab S2.

Maybe if i am on the go and i am worried about losing it, but if i am on the couch, or relaxing on my bed, or even walking my dog, i do that on my tablet.