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Intel To Sack 5,000 Employees

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The one bit of consumer electronics goodness that no-one wanted for Xmas? A PC.

The world's biggest computer chip maker, Intel, says it will cut its workforce by 5% as it expects no revenue growth in 2014. The company told Reuters news agency that it would reduce its global workforce of 107,000.

Intel's gloomy earnings report this week knocked its share price, which was down 2.6 at the close.

A spokesman, Chris Kraeuter, said: "This is part of aligning our human resources to meet business needs."

The weak forecast comes as chip makers continue to be hurt by a drop in sales of personal computers (PCs).

Revenues at Intel's division which makes chips for desktop computers fell 4% in 2013.

However, the company said there had been signs in the past few months that the PC sector was "stabilising".

According to its latest earnings, the PC chip division generated revenues of $8.6bn (£5.2bn) in the October-to-December quarter of 2013, compared with $8.5bn a year ago.

"We had a solid fourth quarter with signs of stabilisation in the PC segment and financial growth from a year ago," said Intel chief executive Brian Krzanich.

For the full year 2013, the firm reported a net profit of $9.6bn, down 13% from a year ago.

http://www.bbc.co.uk/news/technology-25771760

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...everything that does not work should be allowed to fail......everything good should be allowed to prosper.

No success without failure, no failure without success.......get rid of any dead wood. ;)

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From what I understand Intel are more orientated towards the server, data center and network market rather than the consumer market.

The consumer market is huge, but the margins are tiny in comparison - best to let some Chinese company knockout cheap IC's with ARM IP than losing money competing with them.

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I bought into a UK based wafer manufacturer (IQE) when they announced a collaboration with Intel to develop chips for the mobile market. Nothing came of it in the end.

Result is I'm up 25p (last time I checked) on the entire holding of 25k(shares).

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XBOX and PS use AMD, with Intel making almost nowt for the mobile phone marketplace.

The consoles will be big markets, but tiny margins. The new Atoms actually look pretty reasonable for mobile markets, though I can't see many people picking them over ARM unless they have very good emulation.

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I bought into a UK based wafer manufacturer (IQE) when they announced a collaboration with Intel to develop chips for the mobile market. Nothing came of it in the end.

Result is I'm up 25p (last time I checked) on the entire holding of 25k(shares).

IQE looks, interesting, I've added on to the monitor list.

I bought a second hand Dual Zeon Quad core PC - which was probably cost thousands of pounds back in the day, you can pick them up for under £400. I know the chips when they first come out cost $1000 each.

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You dodged a bullet there. I wouldn't fancy working in leixlip.

Wouldn't touch leixlip/Dublin with a barge pole.

It's Shannon i'm interested in as it's a nice small cozy office in the countryside (with plenty of cheap houses about) ;)

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New Atom chips (BayTrail) are like early Core i3 / Core i5 and actually very very good. I'm sat typing this on a Asus T100 (see here) which is powered by one but unfortunately it might be too little too late for both Intel / Microsoft for the majority of consumers in the current tablet / smartphone era.

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The mass market for PC's is currently dead, to be honest I'm surprised AMD don't have a larger market share as for the vast majority of PC functions there chipsets are more than adequate for surfing and a bit of word processing. However Intel have got the ad campaign and that's what people want.

MS haven't helped with producing a touch screen operating system when the vast majority of PC's aren't touch screen. Total genius.

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The mass market for PC's is currently dead

Sure, if you count selling nearly a million PCs a day in the last quarter as 'dead'.

AMD's problem is that Intel's R&D budget is more than AMD's revenue. They have crappy CPUs and good graphics, and have been trying to exploit that by pairing a crappy CPU with a half-competent GPU in the sub-$200 market; but that's only of interest to people who like to play games... just not very much.

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Sure, if you count selling nearly a million PCs a day in the last quarter as 'dead'.

AMD's problem is that Intel's R&D budget is more than AMD's revenue. They have crappy CPUs and good graphics, and have been trying to exploit that by pairing a crappy CPU with a half-competent GPU in the sub-$200 market; but that's only of interest to people who like to play games... just not very much.

In terms of economics it's dead, as you aren't going to be increasing PC sales anytime soon.

http://news.cnet.com/8301-1001_3-57616994-92/pc-shipments-continue-decline-slip-6.9-percent-in-q4-2013/

Global PC shipments for 2013 totaled 315.9 million units, declining 10 percent from 2012. Lenovo overtook Hewlett-Packard as the leading vendor in 2013, while Dell held steady in the third spot. Taiwanese manufacturers Acer and Asus both saw substantial declines year over year in the fourth quarter. The two companies have cut back on PCs, focusing more on mobile, connected devices such as tablets and Chromebooks.

So about 860k a day sales.

The market is saturated.

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In terms of economics it's dead, as you aren't going to be increasing PC sales anytime soon.

Many industries would be very glad to be 'dead' and selling over 300,000,000 units a year.

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The mass market for PC's is currently dead

Mass-market, perhaps. But PC gaming remains at the leading edge and will stay there - already PCs are ahead of anything a PS4/xbox one can do and the gap will only grow in the next few years.

In any event, the new consoles are basically PCs - with almost identical gaming PC infrastructure. The new STEAM PC will only add to this.

PCs will always have a future.

Edited by Errol

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Many industries would be very glad to be 'dead' and selling over 300,000,000 units a year.

Their problem is the trajectory of the market. They had an overwhelming share in desktop and laptop PCs but that market is declining fast and so are margins. Server market should be holding up but I don't think they can compensate for the lost sales.

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