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Intel (INTC) stock price has dropped around 5% as Apple announced that it is going to make its own chips for Macs in 2021.
Intel Corporation (NASDAQ: INTC) stock price has fallen. The stock prices of the chipmaker fell by about 1.76% to $59.04 at the closing of the last trading session. During the trading session, shares hit lows of as high as 6%. At the time of writing, in the pre-market, Intel (INTC) stock price was $56.16 (-4.88%).
Intel also released its earnings report yesterday. The earnings per share were $1.45. This amount was adjusted though. The $198.3 billion revenue generated beat the general estimate of $18.7 billion.
It also represented a 23% rise from last year. It is also above Intel’s $19 billion estimates. In guidance, Intel had also given an estimate of $1.10 in adjusted earnings. It has also said that demand from government enterprises will weaken in the latter half of this year.
Intel (INTC) Stock Price Dropped Due to COVID-19
This weakness in demand is due to the COVID-19 situation. As a result of this, Intel (INTC) has declined to give any guidance for 2020.
Intel’s computing group ( the group that produces chips for personal computers ) posted revenue of $9.78 billion. This is an increase of about 13.8%. The Data Center group that provides chips for cloud services posted revenues of $6.99 billion. This represents a 42.7% increase.
The Internet of Things (IoT) unit of Intel’s business went up 1.6% to $1.14 billion. The non-volatile Memory Solutions unit was also up by 46.2% to $1.34 billion.
The company suspended share buybacks this year saying in a statement:
“The company maintained essential factory operations with greater than 90 percent on-time delivery while supporting employees, customers, and communities in response to the COVID-19 pandemic.”
Apple Plans to Make Its Own Chips for Mac
This comes as reports have emerged that Apple Inc (NASDAQ: AAPL) plans to make its chips. As we have already reported the Cupertino California technology giant plans to premiere at least one device with its chip. This has led to many speculations. Many believe that Apple is planning to abandon its highly lucrative Intel partnership.
That may not be the case as the chipmaker and the iPhone maker still have many other things planned down the line. It does represent a shift though for Apple who wants to create its own devices internally.
Sources also say that this is also part of a transition for the Mac manufacturer. Apple (AAPL) reportedly plans to work with Taiwan Semiconductor Manufacturing Co. Ltd. on this. sources say that they also plan to use 5-nanometer technology in manufacturing.
Plans for chip designs with up to 12 cores are also reportedly in the pipeline. Pundits believe that the future Mac cores will be much faster on new Apple devices than the current ones.
While much of these reports are still speculation, it shows that Apple is evolving. This shift means that we are going to expect faster products and unique ones for that matter.
Intel will always have a market for its chips. That is if it continues on its current trajectory. It still holds the largest market share for processors on a global scale. A little competition sometimes is a good thing.