Intel’s smartphone problem

April 15, 2015

Intel still dominates the chip market, but, as this interactive Reuters graphic shows,  its earnings are down significantly.

Intel041515-620

 

The problem for Intel is that it has been slow adapting to huge-yet-still-burgeoning smartphone sales, and traditional computer sales are slowing. Worldwide PC shipments were down 5.2 percent during the first quarter of 2015, and market research firm Gartner sees traditional computer sales shrinking over the next couple of years–though still selling a quarter of a billion units per year.

There’s also a legacy issue here. It was Intel co-founder Gordon Moore who came up with the 1965 law predicting that data density, or the amount of processing power per square inch on integrated circuits, should double roughly every 18 months. It has proven remarkably reliable over the past 50 years, but Intel’s latest numbers suggest that prescience on the tech front isn’t always prescience on the business front.

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