|New Threads Only:|
|New Threads & Replies:|
Forum List » Value Ideas and Strategies|
Share and discuss value investing ideas and investing strategies.
Intel’s Woes Are Far From Over
Posted by: Arrow Analysis (IP Logged)
Date: April 26, 2014 08:28AM
Industry giant Intel (INTC) continues to suffer from the fallback of losing Samsung’s (SSNLF) business to Qualcomm (QCOM) as stocks continue to dip, worrying investors. Earlier this year, Samsung announced that it would discontinue using Intel’s line of Atom processor’s in favor of its biggest rival Qualcomm’s Snapdragon 400. The decision was a big blow to company’s expectations and poses a serious threat to the 40-million chip sale target announced.
Intel released its first quarter earnings on April 15, and the numbers left even the most optimist investors a tad disappointed. Gross revenue was down 8% from the fourth quarter of last year to $12.8 million, while net income was down 26% in comparison to the same quarter.
Although things look bleak for Intel, it, by no means, signifies curtain-fall. The main reason the Mobile and Communications group shows declining revenue is because Intel is subsidizing the cost of its tablet chips. Once Intel sufficiently lowers the cost of its chips, the fall will dwindle, company officials claimed.
Intel’s woes are far from over. Even if it manages to profit largely from the Bay Trail SoCs, it still has tough competition from companies like Allwinner and Rockchip which also sell chips at the $5 level in order to entice companies like Onda and Ramos. Krzanich is also targeting 40-million chip sale and is willing to sell SoCs at less than cost to achieve this goal. Intel’s main competitor, Qualcomm, too poses a serious threat.
Stocks Discussed: INTC, SSNLF, QCOM,
Disclaimers: GuruFocus.com is not operated by a broker, a dealer, or a registered investment adviser. Under no circumstances does any information posted on GuruFocus.com represent a recommendation to buy or sell a security. The information on this site, and in its related newsletters, is not intended to be, nor does it constitute, investment advice or recommendations. The gurus may buy and sell securities before and after any particular article and report and information herein is published, with respect to the securities discussed in any article and report posted herein. In no event shall GuruFocus.com be liable to any member, guest or third party for any damages of any kind arising out of the use of any content or other material published or available on GuruFocus.com, or relating to the use of, or inability to use, GuruFocus.com or any content, including, without limitation, any investment losses, lost profits, lost opportunity, special, incidental, indirect, consequential or punitive damages. Past performance is a poor indicator of future performance. The information on this site, and in its related newsletters, is not intended to be, nor does it constitute, investment advice or recommendations. The information on this site is in no way guaranteed for completeness, accuracy or in any other way. The gurus listed in this website are not affiliated with GuruFocus.com, LLC. Stock quotes provided by InterActive Data. Fundamental company data provided by Morningstar, updated daily.