It is common knowledge that when it comes to the CPU market, Intel is not doing too well and reports are coming in that claim that Intel has just lost a customer that is worth $1 billion a year. That is a huge number even for a company as big as Intel. You need to keep in mind that this is not a small company that we are talking about. Intel has been in business for years and many companies depend on the products that Intel brings to the table.
Intel has lost one-fourth to one-third of its revenue and that is a major chunk. Having that said, you must wonder what is going on. Adding to the fact that an Intel Senior Vice President was seen, resume in hand at a competitor, means that there is indeed something very wrong. Intel team has been having issues with the 10nm process and it has been delayed plenty of times but knowing that big blue is a giant and can hold out for a while, we did not realize the gravity of the situation.
While the reports did not state which competitor it was, but it is safe to say that this is AMD. We have seen people move from AMD to Intel so it would not be surprised if AMD snagged a few people from Intel. That is how things work. While the reports do not give details into the matter, they do claim that they have been investigating the matter for months now and that Intel does not want people to learn about this. If this is true then this is very shady indeed.
We know that Intel has been lagging behind when it comes to the 10nm process and that has caused a stagnant laptop market. The company claims that the 10nm based CPUs will be ready and on the shelves by H2 2019 but by then AMD would have already released their 7nm based CPUs. While it is debatable, which process is better, one thing is for sure, Intel is lagging behind.
We also know that the chips that will be coming out this year will be based on the 14nm++ process. It will be interesting to see how Intel is going to compete with AMD while relying on the same process that we have had around for a while. The company took a major hit just recently when the CEO was forced to resign. The following is the official statement regarding the matter:
Intel was recently informed that Mr. Krzanich had a past consensual relationship with an Intel employee. An ongoing investigation by internal and external counsel has confirmed a violation of Intel’s non-fraternization policy, which applies to all managers.
While Intel has taken a hit when it comes to revenue. AMD has performed better than expected and has beaten the predictions of many analysts. The following is what AMD CEO Lisa Su had to say in this regard:
Turning to large enterprise customers, we added dozens of new end customers in the quarter. Our value proposition continues to be strong in segments like HPC, data analytics and in general-purpose virtualized enterprise environments. We are extremely focused on accelerating EPYC processor adoption in these targeted segments in the second half of the year.
It is possible that the customer that Intel lost could go to AMD but we do not know who that customer is, so only time will tell. For more news regarding the matter stay tuned to SegmentNext.
Let us know what you think about Intel losing a $1 billion customer and what you think would be going on behind the scenes at the company.