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Don't Count Intel Out Just Yet

Abhinav Davuluri, CFA (abhinav.davuluri@morningstar.com)

Over the past decade-plus,  Intel's INTC prowess in chip design and manufacturing has enabled it to dominate the PC and server processor markets. Although it missed the boat in smartphone processors, Intel's near monopoly in server central processing units, or CPUs, has allowed the wide-moat chip titan to enjoy stellar profitability amid a declining PC market while riding the cloud wave to substantial growth in its data center group. Although AMD has minimal share today, the combination of Intel's 10-nanometer process technology delays and AMD's upcoming 7-nm Epyc 2 has led the market to anticipate substantial share gains for AMD and the demise of Intel.