Intel to mask billion-dollar mobile losses with new financial reporting structure
Sam Oliver
With its troubled mobile chip unit hemorrhaging cash — thanks in part to Apple's domination of the smartphone and tablet markets — Intel this week announced that it would no longer report mobile earnings as a separate line item, instead choosing to lump them in with its money-minting PC business.
Intel's Mobile and Communications Group will be financially merged with the PC Client Group under the banner of a new Client Computing group, which will encompass "platforms designed for the notebook, 2 in 1 systems, the desktop, tablets, and smartphones; mobile communication components; as well as wireless and wired connectivity products."
The chip giant's mobile division has lost more than $7 billion since 2012, while the PC business has pulled in over $27 billion in the same span.
Word of the move — which will have the effect of hiding Intel's staggering mobile losses behind the PC group's strong sales — first surfaced late last year, but was not officially confirmed until now. The new structure will take effect beginning with Intel's Q1 2015 earnings, which are due next week.
Still a force to be reckoned with in data centers and on the desktop, Intel was nevertheless late to the mobile party and has found itself outclassed by ARM-based chips. Apple and Samsung, which together account for the majority of smartphones and tablets sold each year, each depend largely upon their own in-house silicon.
Intel is believed to have scored a small win by securing a contract to supply baseband chips for the so-called "iPhone 7," but that would be more of a moral victory than a financial one.
Apple's A-series chips have become so performant that many industry watchers expect to the company to eventually release an A-powered MacBook, which could bite into Intel's finances even more deeply. Such a shift is already underway in the enterprise, with many companies exploring and deploying ARM-based servers to lower capital expenses and conserve energy.
Malcolm Owen
Amber Neely
Marko Zivkovic
David Schloss
Wesley Hilliard
Mike Wuerthele and Malcolm Owen
38 Comments
Well the new Macbook uses an Atom and it's arguably a PC, so maybe such a reorganisation does make sense.
I remember working doing an Itanium port almost 13 years ago. Intel was hemorrhaging money because they bet Itanium vs. the AMD64. It took them almost 5 years to turn around their ship then and scrap the Itanium and pour resources into the 'low end CPUs' back then. My prediction is that the same will happen with the mobile CPUs.
"Performant" is not recognized as a legitimate English word by Websters, or Merriam-Webster.
Even if you use other references to justify, its use here seems forced.
"Performant" is not recognized as a legitimate English word by Websters, or Merriam-Webster.
This isn't the New York Times. It's a tech blog using a word that is used sometimes in tech/software/engineering vernacular.
Well the new Macbook uses an Atom and it's arguably a PC, so maybe such a reorganisation does make sense.
No, it doesn't use an Atom. It uses a Core-M. Why make blatantly false claims?