Intel corp. Stock facing consecutive day of loses !!
There is fall in the Intel stock price, it is seen Intel is struggling to gain momentum in market. On last Friday,6th sept stock closed at 18.89 at 4:00 PM and Monday closed at $19.07. Reportedly, Intel is on timeline with not so good news. Some experts says that Intc stock may falls further before it rises again. That's all seems to be outcome of company's struggle in many aspects. At the end of 2023, stock was $50 per share which was almost 2.5x of the current. where as back in 2001 Intel stock was trading at about $60 per share. Intel has taken several wrong steps for which it loses it's significant market share to it's competitors. Let's discuss elaborately what are the factors contributing to the current situation.
Why Intel's stock hits low ?
Intel as a company always been a integrated device manufacturer. They do their design, research and manufacturing by themselves where as some other competitive companies like AMD and Nvidia outsources from different third party companies.
Once Intel was known for it's excellent and advanced chip production , over the past few years it's legacy seems to be declining and now its standing behind it's competitors like Samsung and TSMC.
| Year | Intel Revenue (Billion USD) | Reason for Decline |
|---|---|---|
| 2021 | 79 | --- |
| 2023 | 54 | Decline in CPU sales, PC market cooling, AMD market gains, rise in mobile & AI chips demand |
Intel's Losing market share
Intel revenue declined over the year, Many factors affected the market of Intel such as CPU sales declined due to Covid lockdown and also demands for the AI powered mobiles and PCs increases over the period but unfortunately Intel was lagging in manufacture of AI chips. Over the past 10 years Intel's stock dropped more than 50%, which is mainly due to losing market share to its competitors AMD, Qualcomm and Nvidia. Though PC sales seems to be improving this year but it is still a doubt whether Intel stock could recover or not.
Intel's strategies gone wrong
Over the past few years, it is also seen that there were shift of strategies over different CEO of the Intel. Company was not focusing on the manufacture of mobile chips instead it was focusing on cost cutting, buying its own shares rather resolving the core problems ,which also contribute to the declining stock price.
Increased demands for AI
Intel CPU business may face new challenges as some other companies ARM and Qualcomm are entering into the PC business. Microsoft PC Copilot+ uses ARM chips which is more power efficient, smart and fast. Demands for AI increases across all devices in order to process and perform day to day activities. Demands for AI features is widely popular among the new generation content creators, social media influencer.
Resignation of Intel's board member
Recently one of the board member, Lip-Bu Tan exits because of his personal commitment and priorities. As per some sources Tan was frustrated with large workforces of the company. He wanted to cut down the cost by minimizing crowds in the company. He wanted to remove middle managers and keeping the core engineers.
Check: why Intel's board member
Intel's plans to fight back
Recently intel has launched Core 200V series processor code named "Lunar lake" on 3rd sept,2024 . This new processor will be used in ai powered pieces PCS. It is claimed that this will upgrade the graphic performance by 50%. It will also consume 40% less power than it's predecessors. Intel is hoping to fight back it's battle in AI space with this new processor. Intel also said that this processor will be loved by the newer content creator. This may bring momentum in sales.
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