Intel Falls on Latest Server Chip Delay; Rival AMD Gains - Yahoo Finance

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(Bloomberg) -- Intel Corp. fell after saying a new version of its Xeon server chip line will go into production in 2022, rather than by the end of this year as promised, the latest in a series of delays that have cost the company technology leadership of the chip industry.Rival Advanced Micro Devices Inc. rose after Intel said Tuesday that a chip design, code-named Sapphire Rapids, will begin production in the first quarter of 2022 with the “ramp” beginning the following quarter. The world’s largest chipmaker previously said the new version of its most lucrative product line would start to be manufactured this year.Chief Executive Officer Pat Gelsinger has pledged to return Intel to a dominant position in computer processors and reassert the company’s once unassailable lead in semiconductor manufacturing. Multiyear delays in the introduction of new technology by Intel have ceded leadership to rivals. Gelsinger, who promised the new chip would arrive this year as recently as April, last week replaced the head of Intel’s server chip unit in an executive shake-up.

“Given the breadth of enhancements in Sapphire Rapids, we are incorporating additional validation time prior to the production release, which will streamline the deployment process for our customers and partners,” Intel Vice President Lisa Spelman said in a post on the company’s website. “Based on this, we now expect Sapphire Rapids to be in production in the first quarter of 2022, with ramp beginning in the second quarter of 2022.”

Intel shares declined 1.3% to $56.75 at the close of New York trading while AMD gained 2.8% to $89.52. Intel’s slide limited overall gains by chip stocks. The Philadelphia Stock Exchange Semiconductor Index rose less than 1%.

Given the delays to the 10-nanometer manufacturing process and holdups in bringing its replacement online, the latest announcement will cause concern about further decays in Intel’s competitive positioning, according to Sanford C. Bernstein analyst Stacy Rasgon.“A less charitable explanation, however, is that the company’s competitive positioning is worsening, and that the downside associated with delaying Sapphire Rapids (both for the products and, it should be said, for the stock) is perceived by management to be less that what would be experienced by launching earlier with a less competitive product,” he wrote in a note to clients. “Recent executive changes in the datacenter business may feed into this as well.”

Intel’s data center unit until recently had more than 99% of the market for chips that are the heart of corporate networks and internet infrastructure. Such processors can sell for the price of a compact car and are the company’s most profitable offerings. Regaining a foothold in that market has been a key part of the turn around in AMD’s fortunes under Chief Executive Officer Lisa Su.

The smaller company is projected to report a 50% increase in revenue this year following a 45% surge in 2020. Intel is one of the few major chipmakers that will suffer shrinking sales, according to analysts’ estimates.

(Updates with closing share prices in the fifth paragraph.)

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June 30, 2021 at 12:31AM
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Intel Falls on Latest Server Chip Delay; Rival AMD Gains - Yahoo Finance

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NVIDIA, AMD, or Intel: Which Is the Best Chip Stock to Buy Right Now? - Motley Fool

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The PHLX Semiconductor Sector Index has generated solid gains so far this year, despite the chip shortage and the sell-off in tech stocks earlier in 2021. However, not all of the index's components have been on fire.

While NVIDIA (NASDAQ:NVDA) stock has roared higher on the back of a strong showing from its gaming and data center businesses, Advanced Micro Devices (NASDAQ:AMD) stock price has failed to sustain its terrific momentum from 2020 and headed south. Intel (NASDAQ:INTC) stock, meanwhile, has pulled back over the past couple of months as its April quarterly report gave rise to a bunch of red flags.

AMD data by YCharts

Does this mean NVIDIA is the one you should be buying? Or will AMD's and Intel's fortunes turn around in the second half of the year, making them potentially better buys than the richly valued NVIDIA? Let's find out.

NVIDIA: Benefitting from long-term growth catalysts

It is safe to say that NVIDIA is firing on all cylinders, as almost all the company's business segments registered eye-popping growth in the first quarter of fiscal 2022. Barring the automotive business, which saw a 1% revenue decline, the gaming, data center, professional visualization, and OEM (original equipment manufacturer) segments recorded varying degrees of impressive growth during the quarter.

As a result, NVIDIA's total Q1 revenue jumped 84% year over year to $5.66 billion, while non-GAAP earnings more than doubled to $3.66 per share. The company's guidance was also a solid one, with its estimated second-quarter revenue of $6.3 billion expected to increase nearly 63% year over year at the midpoint of its guidance range.

Image source: Getty Images.

NVIDIA can sustain such high rates of growth beyond 2021 as the data center and gaming markets, which account for nearly 85% of the total revenue, are sitting on long-term catalysts. The data center segment's revenue hit $2 billion for the first time last quarter, recording 79% growth over the year-ago period. NVIDIA credits the segment's outstanding growth to strong demand from hyperscale customers deploying its GPUs (graphics processing units) for artificial intelligence (AI) applications.

NVIDIA says that its data center GPUs are "deployed across all major hyperscale and cloud service providers globally and we see strengthening demand in the coming quarters." That's not surprising, as the demand for data center GPUs could grow at a compound annual growth rate (CAGR) of 42% through 2027, hitting $20.6 billion in revenue. NVIDIA is in a solid position to tap this opportunity, as it supplies its GPUs to the top cloud service providers and has been taking steps to diversify its revenue streams.

Meanwhile, NVIDIA's 80%-plus market share of gaming graphics cards will be another big tailwind for the company. Its video gaming revenue more than doubled last quarter to $2.76 billion. Jon Peddie Research estimates that the market for discrete gaming GPUs could jump from $23.6 billion last year to more than $54 billion by 2025. NVIDIA's dominant market share means that it could win big from the additional revenue opportunity.

Advanced Micro Devices: Widening its gap over Intel

AMD stock's retreat on the market isn't justified, as the chipmaker's impressive financial growth has continued this year after a strong 2020. AMD is on track to record 50% revenue growth in 2021, though it can do better as it was originally anticipating a 37% increase when the year began. The company's market share gains in the client and server CPU (central processing unit) markets, as well as the growing demand for graphics cards, have encouraged it to raise the guidance.

However, AMD can finish the year on a much stronger note, as it recorded 93% year-over-year revenue growth in Q1 to $3.4 billion, which was ahead of the market's expectations. The company is pulling the right strings to ensure that it sustains its high levels of growth, such as consistently winning market share from Intel.

Popular video game distribution platform Steam reports that AMD's share of the client CPU market has now exceeded 30%, a massive improvement from three years ago when it held just over 16% of the market. AMD's gains have been driven by a superior manufacturing process based on a 7-nanometer manufacturing node, while Intel's competing chips are expected to be out later this year.

But AMD seems all set to widen the gap over Chipzilla, as the former's foundry partner Taiwan Semiconductor Manufacturing is working on smaller 5nm and 6nm nodes. Such a move is likely to give AMD's Ryzen CPUs another performance boost and ensure that they continue to sell like hotcakes.

On the other hand, the massive increase in sales of gaming graphics cards, as discussed earlier, will also be a tailwind for AMD. That's because AMD plays second fiddle to NVIDIA in the GPU market, and the additional revenue opportunity over there could substantially add to its revenue in the long run. Throw in other catalysts such as the new console cycle that's giving AMD a significant lift, and it becomes easier to see why the company's fast growth is here to stay.

Intel: Trouble regaining its mojo

Unlike its rivals, Intel is in a rut. The chip giant has been unable to regain its mojo since losing its competitive edge. That was evident from Intel's Q1 results, as non-GAAP revenue of $18.6 billion was flat on a year-over-year basis. Gross margin shrank 6.1 percentage points year over year while operating margin fell 6.7 percentage points. As a result, Intel's net income was down 6% over the year-ago period.

Things are about to get worse for Intel in the second quarter. Revenue and adjusted earnings are expected to drop 10% and 15% year over year, respectively, while full-year non-GAAP revenue is anticipated to drop 7% to $72.5 billion. So, Intel's poor financial performance and outlook put it behind the likes of NVIDIA and AMD, which are delivering irresistible growth. As such, growth-oriented investors may drop Chipzilla from their watchlist of stocks to buy.

The verdict

With Intel out of the race, investors looking to buy a fast-growing semiconductor stock can choose either NVIDIA or AMD. From a valuation standpoint, AMD looks like the better buy as it trades at 36 times trailing earnings, compared to NVIDIA's multiple of nearly 90 times. AMD's price-to-sales ratio of nine is also much lower than NVIDIA's multiple of nearly 25 times.

Given that AMD's pace of growth was better than NVIDIA's in Q1 and is likely to keep up that momentum for the remainder of the year, it looks like a steal right now. AMD also looks like a better buy for those looking for a growth stock at a reasonable valuation. However, investors with a higher appetite for risk may also consider buying NVIDIA, as it can remain a top growth stock and justify its rich valuation by delivering terrific growth thanks to huge end-market opportunities.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

The Link Lonk


June 29, 2021 at 09:49PM
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NVIDIA, AMD, or Intel: Which Is the Best Chip Stock to Buy Right Now? - Motley Fool

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Microsoft To Test 7th Gen Intel, 1st Gen Ryzen on Windows 11 - Tom's Hardware

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Microsoft released a blog post today in an attempt to assuage confusion over the system requirements for Windows 11.

The post goes over justification for the system requirements, but also says that Microsoft is open to expanding the lists that cut off at a handful of Qualcomm processors, 8th Gen Intel and AMD's second-gen Ryzen chips.

"As we release to Windows Insiders and partner with our OEMs, we will test to identify devices running on Intel 7th generation and AMD Zen 1 that may meet our principles," the post reads. "We’re committed to sharing updates with you on the results of our testing over time, as well as sharing additional technical blogs."

Microsoft is justifying the new system requirements by stating that Windows 11 is far more secure, including potentially reducing malware by 60% and featuring better encryption and biometric support. A notable security feature is using virtualization-based security, which should pass TPM through to virtualized machines.

Microsoft's three justifications for Windows 11's new requirements. (Image credit: Microsoft)

Additionally, Microsoft is opting for processors that work with the latest Windows drivers and work with the minimum specs for Office and Teams. Part of the security requirement comes from Microsoft requiring TPM 2.0.

The company specifies "fundamentals" of speeds over 1 GHz, dual-core processors, 4GB of memory and 64GB of storage, which still includes a number of PCs that are years old and are not on the current list of supported processors.

It's good to see that Microsoft is considering including more processors, as a number of perfectly capable PCs still use those chips. (Including a number of Microsoft's Surface devices that are still on sale right now!) When Microsoft debuted the list of chips, it angered many enthusiasts who still have perfectly capable PCs, and who suggested that it would create e-waste and force people to get new computers in the middle of a global component shortage.

This testing will come from Windows insider builds, so it's up to the early-adopter community to see how it fares. The first Windows Insider preview for Windows 11 is live now.

Microsoft is temporarily removing the PC Health Check app that let you know if your Windows 10 PC could handle Windows 11.

"Based on the feedback so far, we acknowledge that it was not fully prepared to share the level of detail or accuracy you expected from us on why a Windows 10 PC doesn’t meet upgrade requirements," the post reads. "We are temporarily removing the app so that our teams can address the feedback."

The post promises that tool will be back online before general availability in the fall.

The Link Lonk


June 29, 2021 at 12:47AM
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Microsoft To Test 7th Gen Intel, 1st Gen Ryzen on Windows 11 - Tom's Hardware

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Intel Delays New Chip in First Setback for CEO Gelsinger’s Turnaround Effort - The Wall Street Journal

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Chip maker Intel Corp. is delaying production of one of its newest chips to improve performance, the first significant product setback under new Chief Executive Pat Gelsinger as he seeks to rebuild the company’s competitiveness.

Intel now is planning to start producing the next generation of central processing units for servers—the brains of those machines—in early 2022 after previously saying it would be ready late this year, Lisa Spelman, the company’s corporate vice president, who manages the server-chip business, said in a Tuesday blog post.

The additional time, Ms. Spelman wrote, would allow Intel to improve the chips’ performance, in particular around the highly prized metrics of data handling and artificial-intelligence processing. Production is now set to begin in next year’s first quarter and ramp up in the second quarter, she wrote.

The delay of the new chips is the first under Mr. Gelsinger, who became chief executive in February following major delays in chip-making advances under his predecessor, Bob Swan. Intel almost a year ago said the following generation of even more advanced chips with super-small transistors wouldn’t be ready until late next year, about a year later than initially expected. 

Mr. Gelsinger has vowed to make Intel more reliable in producing new chips. At his first shareholder meeting as the company’s CEO in May, he said Intel was aiming to deliver a “steady cadence of leadership products that our customers can depend upon.”

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June 30, 2021 at 03:28AM
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HP's Pavilion Aero 13 starts at $749, all AMD powered - ZDNet

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HP launched its HP Pavilion Aero 13 laptop that will start at $749, feature four colors, have a 90% screen-to-body ratio and weigh in at less than a kilogram.

The HP Pavilion Aero 13 is an all-AMD machine with the latest AMD Ryzen 7 5800U processor with AMD Radeon Graphics. The device has Wi-Fi 6, up to 10.5 hours of battery life and a screen with a 16:10 aspect ratio and 2.5k resolution.

According to HP, Pavilion Aero 13 will be available this month at HP.com and other US retailers in the fall. Key details include:

• A full magnesium aluminum chassis with 4-sided narrow bezel.
• Colors of Pale Rose Gold, Warm Gold, Ceramic White and Natural Silver.
• 400 nits of brightness for sunlight viewing.
• Manufactured with post-consumer recycled and ocean bound plastics.
• Windows 10 with an upgrade available to Windows 11.

Along with the HP Pavilion Aero 13, HP rolled out the M Series monitor line announced at CES 2021. The company's M Series line includes a 24- and 27-inch displays with the HP M24fwa FHD Monitor and HP M27fwa FHD Monitor, respectively. Both monitors feature streamlined design and cable management and integrated dual speakers with availability in July. The 24-inch monitor starts at $229.99, and the 27-inch monitor starts at $289.99.  

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June 29, 2021 at 08:00PM
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Stock-Picking Dilemma: Intel, Nvidia, Or AMD - Seeking Alpha

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June 29, 2021 at 06:41PM
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Morning Bell With Jim Cramer: Micron Earnings, Nvidia and AMD - TheStreet

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Stocks rose Tuesday and the S&P 500 set a record intraday high as equities built off the gains that kicked off the week.

TheStreet founder Jim Cramer said that among other things he was keeping an eye on Micron Technology  (MU) - Get Report, which is scheduled to report earnings on Wednesday and Nvidia  (NVDA) - Get Report.

Micron Technology: 'The Most Important One'

Cramer said that he thinks there is still strength in DRAM, still strength in strength in NAND.

"I think Micron is the most important one because the semiconductors are really hanging by a thread," he said.

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In March, Micron reported fiscal-second-quarter revenue and adjusted earnings that exceeded Wall Street estimates.

Cramer also discussed Nvidia  (NVDA) - Get Report, noting that three of the world's largest chipmakers went against other big tech companies and blessed the graphics-chip specialist's proposed acquisition of U.K.-based Arm Holdings. 

Nvidia: 'I'd Like to See Some News Here'

Broadcom  (AVGO) - Get Report, Marvell  (MRVL) - Get Report and Taiwan's MediaTek have become the first Arm customers to publicly support the $40 billion proposed takeover. 

Cramer said "this is very, very important."

"I'd like to see some news here," he said. 

Cramer also said he'd like to see Advanced Micro Devices  (AMD) - Get Report close the deal with Xilinx  (XLNX) - Get Report.

Earlier this month, Dealmaker reported that the European Commission hasn’t raised objections to the semiconductor titan’s proposed $35 billion takeover of  Xilinx.

Advanced Micro Devices, Nvidia, Broadcom and Marvell are holdings in Cramer's Action Alerts PLUS charitable portfolio. 

Want to be alerted before Jim Cramer buys or sells the stocks? Learn more now.

The Link Lonk


June 29, 2021 at 09:04PM
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Morning Bell With Jim Cramer: Micron Earnings, Nvidia and AMD - TheStreet

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