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The government and private companies are rushing to add more technology and AI to customer service, but it's not for everyone.
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For years, the mantra in the tech world has been, buy the latest and greatest. The newer, the better. And for some companies, like AMD and Qualcomm, that's been true.
Not anymore. Intel told Wall Street analysts Thursday that it's selling out of its "Raptor Lake" processors and that the process technology they're built upon, Intel 7, is constrained. Put another way, Intel chief financial officer David Zinsner told analysts that Intel is selling more of its years-old 12th- and 13th-gen Raptor Lake (and Raptor Lake Refresh) chips than Lunar Lake.
That's embarrassing, to be sure. But it caps off years of struggles, which some might say date back to Intel's inability to move off of the 14nm node for several generations. Is it any surprise that Intel's new CEO, Lip-Bu Tan, believes that Intel's organizational structure is bloated?
Maybe, but to most people in technology, the answer is simple: if you deliver processors that don't improve over their predecessors, why should you expect customers to buy your newest and most expensive chips? Instead, they'll turn to your older, cheaper processors. And that's what Intel says is happening — especially with the tariff typhoon blowing hard.
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Intel chief financial officer David Zinsner told analysts on Thursday that Intel sold more volume in its Raptor Lake chips than Lunar Lake, suggesting that customers preferred the higher-performance Raptor Lake chips that debuted in 2023 versus the latest Lunar Lake chip that launched last September.
Meanwhile, Zinsner suggested that Intel's future is extremely uncertain, due to the Trump administration's varying economic policy. "The very fluid trade policies in the U.S. and beyond, as well as regulatory risks, have increased the chance of an economic slowdown with the probability of a recession growing," Zinsner said. "This makes it more difficult to forecast how we will perform for the quarter and for the year, even as the underlying fundamentals supporting growth I discussed earlier remain intact."
Zinsner also gave an enormous range for the company's spending plans of between $8 billion and $11 billion, because Intel doesn't know what the future of the CHIPS Act might be.
Older, cheaper, higher-performance Intel CPUs are the favorite
The surprise, however, was how Intel's customers are dealing with tariffs — simply buying older products instead. Intel executives said that the Intel 7 process — the foundation of the Raptor Lake chips — was constrained, and so was production of the chip itself. That's because customers
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