Its clear that there is huge cannibalization going on in retail & now the business segment. Volume is not going to "make up" for the ASPs & margin dollars that the traditional PC market enjoyed. That is what's going on. Of course, Intel management is not going to come out & say it in those terms, so they issue a very low forecast to cover their #$%$
My guess is that this going to trigger a lot of downgrades (in addition to the obvious EPS reductions) starting next week. The reverse in sentiment, along with the macro market correction which is about to happen (another gov't budget crisis starting soon), will drive the stock back into the $18-$22 range as a bottom over the next 12 months. Intel management lost a lot of credibility yesterday & the scary part is, they are too incompetent & arrogant to notice.
Its sad to say, but Covello has been pretty much right on with his intel calls. He is the 1 that called Intel to fab competitor chips & everyone laughed at him at the time.
This is a huge miss. Intel management should have at least released this new forecast last week & then have all "good news" for the investor meeting. This is a sleazy tactic that AMD would use & all it does is reduce trust with shareholders.
Hype the stock all day with rosy technology forecasts & then in AHs sneak in that they are missing already lowered 2014 revenue by $1-$2Billion. No one should trust this management team. A poor & incompetent way to communicate with your shareholders. Period.
Stacy Smith guided lower on 2014 revenue guidance - at least lower than current analysts projections. It hasnt been picked up on any of the major news wires apparently. This is some shady disclosure on Intel's part. Flat revenue for 2014 is significant. To disclose it in an AHs presentation with no press release is weak.
INTC was overbought to begin with. And, now, this revenue bomb in AHs. This market has not been kind to bad news.
Most forecasts had a 1 - 5% revenue growth for 2014. Hey Intel BoD - why dont you lay off some employees to get costs in line with revenue!!! Intel shareholders continue to suffer, while management is fat & happy. Otellini gets $10M in compensation - sickening.
It appears Intel has no choice. x86 will never get the majority of design wins in retail digital (for a lot of reasons). Brian K. basically admitted that today. The hope is that the corporate x86 market will not fall like a house of cards like retail x86 is doing.
I bought more ARMH this morning. Sold some INTC AHs. Thanks for asking.
Flat 2014 revenue guidance...Are you kidding me?!? No OEMS/software companies are going to design for x86 after Brian K's mea culpa today. Intel lost the digital client today.....
I agree totally. I was the 1st to bring this "risk" to the Board this morning while the rest of this Board were giving themselves high-fives. The Bear analysts will be all over this flawed strategy. I'm a buyer of ARMH on this news. Today is the beginning of the end for x86 in the retail market. PC Group down 5-9% next year! Are you kidding me...they slip this news at the end of the day. Nice job Intel.
I warned Wally of this "risk" this morning, yet all he did was call me names.
I warned everyone of the "risks" of a new business model this morning. Intel basically said today x86 will not be dominant going forward by willing to manufacture ARM CPUs. A huge red flag. Intel is losing the digital retail client.
My model is saying is we'll consolidate a bit here in the $25 area, before moving higher. Would have liked to have heard a dividend hike from Brian K. this morning.
Maybe you should listen better & read the analysts comments. This is a shift in strategy & Intel will build ARM products, including those they compete with. It's obvious Intel wants Apple's business & you're nuts if you think Apple is going to switch away from their custom-design ARM CPUs. Intel is admitting they will never get close to dominant share in phones/tablets in x86 (as they did with PCs), so might as well get some portion of the sale, than none.
Yup. An admittance of x86 failure in mobile, especially smartphones. Buying ARMH is the play here. Intel content to be a manufacturing outsourcer = lower margins going forward.
Big shift in strategy today. BK basically admitted ARM will remain the high-volume leader as Intel transitions itself to a contract manufacturer. Expect Intel margins to collapse - there is a reason BK didnt bring up margins in his "forecast".