Intel Crisis Are Getting Deeper
Intel’s problems are even worse than what we’ve heard in the media. There are new signs that the once powerful innovator is losing market share in more and more areas and the chance of making up for it is dwindling.
Intel at a crossroads
The Wall Street Journal reveals in a comprehensive analysis of the dramatic crisis the former innovation champion Intel. The report paints a bleak picture of a company losing its market dominance at an incredible rate.
The core problems are diverse: While Intel has traditionally been the leader in processors for data centers, AMD has now turned the tables. In the current quarter, AMD exceeded Intel’s data center chip sales for the first time. This is not only a remarkable drop after Intel’s sales in 2022 were three times as high as today, but also a glaring warning signal.
Particularly dramatic: The trend is towards graphics processors (GPUs), which are crucial for AI applications. Intel currently has virtually no market presence here, according to the Wall Street Journal. Large cloud providers such as Amazon, Microsoft and Google are increasingly relying on their own ARM-based chips, which are more efficient and powerful.
The expulsion of CEO Pat Gelsinger in December was only a small signal to the outside world in the crisis. Intel’s attempt to become competitive again through massive investments in chip manufacturing and technology such as the “18A” manufacturing process is highly risky. The group posted a loss of $16 billion in the last quarter and there is still no end in sight.
Discontinued model
Analysts only see a possible turning point. A split between the product and manufacturing divisions is being seriously discussed. However, the prognosis is sobering. Intel could become a discontinued model if radical changes are not made soon.
The successful formula of earlier days – Intel’s legendary “Only the Paranoid Survive” strategy – appears to be outdated and no longer applicable, according to analyst circles. The former innovation giant is now struggling for its existence in a market that is rapidly being shaped by AI, ARM architectures and custom chips. Intel is planning a “year of stabilization” for 2025 – whether this will succeed is more than questionable. The technology giant is facing nothing less than reinvention.
