Intel’s interim CEO Bob Swan denied that the company has a CPU shortage in a Q&A session with analysts late Thursday.
The comments came as the chip heavyweight reported its Q4 earnings, missing projections and disappointing markets, despite a record year./
Chris Caso, an analyst at investment bank Raymond James asked: “I wanted to receive an update on the some of the CPU shortages that you’ve been experiencing, and how you are progressing on alleviating those shortages.”
“First, in the fourth quarter just in terms of isolating how we prioritize our capacity, there were no shortages” Swan replied.
“Inventory levels were relatively low as you might imagine on CPU just because of the constraints we’ve been dealing with” he acknowledged.
The company has faced capacity constraints as it focussed on fabricating its largest revenue driver, server chips to the detriment of lower-level CPU production.
Record Performance, but Market Headwinds
Results were mixed, with the company reporting Q4 revenue of $18.7 billion, while full-year revenue set an all-time record of $70.8 billion, up 13 percent year-on-year.
Intel is expecting record 2019 revenue of approximately $71.5 billion and first-quarter revenue of approximately $16 billion.
An update by investment bank Jefferies captured some of the headwinds Intel is facing: “We are bullish on semis in part because consolidation is driving pricing power and higher margins, but we think the opposite will happen to Intel over the next 12-to-24 months…” its analysts wrote.
“In the data center, Nvidia GPUs have quickly grown to 10% of Intel’s DCG, XLNX FPGAs are starting to gain traction, and we think AMD and ARM will hit their datacenter stride by EoY 2019… On the PC side, AMD appears to be gaining share in the high end, and we wouldn’t be surprised to see Apple introduce an MPU for its PC products.”
As for that elusive CEO, we were wrong: no announcement was forthcoming.
Swan said: “The Board continues to evaluate candidates for what I believe is the biggest and best open job on the planet. They are proceeding with a sense of urgency while also ensuring that they make the right choice for this great company. “