4 ms·

Suddenly, what Intel's CEO means by new products must deliver 50% gross profit [1], and it being too late to catch up with AI [2] is starting to be clearer. [1

Suddenly, what Intel's CEO means by new products must deliver 50% gross profit [1], and it being too late to catch up with AI [2] is starting to be clearer. [1]: https://www.tomshardware.com/tech-industry/semiconductors/intel-draws-a-line-in-the-sand-to-boost-gross-margins-new-products-must-deliver-50-percent-to-get-the-green-light https://www.tomshardware.com/tech-industry/semiconductors/in... [2]: https://www.tomshardware.com/tech-industry/intel-ceo-says-its-too-late-for-them-to-catch-up-with-ai-competition-claims-intel-has-fallen-out-of-the-top-10-semiconductor-companies-as-the-firm-lays-off-thousands-across-the-world https://www.tomshardware.com/tech-industry/intel-ceo-says-it...

baq 1y ago
CEO of a silicon company saying his business is "too late for AI" is a CEO either without a vision or guts, an accountant, the safe option. If it's anywhere close to true, Intel is looking to sell itself for parts.
- freedomben 1y ago
  Agreed, either their business situation is far more critical than we know, this is a gross indictment of their R&D, or this is malpractice on the part of the leadership
- checker659 1y ago
  > of a silicon company With their own fabs, at that
- moralestapia 1y ago
  Well, but if it's true and there's a better strategy, why wouldn't he do it? Seems like you'd prefer yet another +1 selling AI oil and promises ...
- h2zizzle 1y ago
  Or, a sly way of calling the AI bubble.
- tester756 1y ago
  The real quote is: >"On training, I think it is too late for us," Not too late for AI, but too late for training meanwhile there's inference opportunity or something like that
- aDyslecticCrow 1y ago
  Too late for the AI boom if they have to spend another 2 years and manufacturing investments to get a product out for the segment. We are over-inflated on AI hype. Its relevance will remain but betting a company on it isn't a wise idea.
- BeetleB 1y ago
  There's a whole backstory to this. When he joined only a few months ago, he set the vision of making Intel a worthy participant in the AI space. Then just a few months later, he announced "we cannot compete". What happened in the middle? Recent articles came out about the conflict between him and Frank Yeary, the head of the Intel board. He wanted to acquire a hot AI startup, and Frank opposed it. Two factions were formed in the Board, and they lost a lot of time battling it out. While this was going on, a FAANG came in and bought the startup. I think his announcement that Intel cannot compete was his way of saying "I cannot do it with the current Intel board."
  - Scramblejams 1y ago
    What startup was it?
    - BeetleB 1y ago
      The news articles didn't name it.
  - horsawlarway 1y ago
    Feels like a fair statement. My read is basically that Intel's board is frustrated they can't part the company out, take their cash, and go home. I'd also be incredibly frustrated working with a board that seems deadset on actively sabotaging the company for short term gains.
  - downrightmike 1y ago
    What happened is they fired tens of thousands of their workforce. They knee-capped themselves. Having people with experience and institutional knowledge is required. You can't just toss that out the windows and expect things to work.
    - BeetleB 1y ago
      By any measure, Intel was bloated. All their competitors are doing a lot more with a lot fewer people. Now whether they fired the right tens of thousands is another matter.
phkahler 1y ago
Cutting products that don't have 50 percent margins seems like a bad choice when their goal should be filling their advanced fabs. Keeping that investment at or near capacity should be their goal. They said they'd have to cancel one node if the foundry business couldn't get enough customers, and yet they're willing to cut their own product line? Sure they need to make a profit, but IMHO they should be after volume at this point.
- KronisLV 1y ago
  Even the Arc B580 GPUs could have been a bigger win if they were actually ever in stock at MSRP, I say that as someone who owns one in my daily driver PC. Yet it seemed oddly close to a paper launch, or nowhere near the demand, to the point where the prices were so far above MSRP that it made the value really bad. Same as how they messed up the Core Ultra desktop launch, of their own volition - by setting the prices so high that they can’t even compete with their own 13th and 14th gen chips, not even mentioning Ryzen CPUs that are mostly better in both absolute terms and in the price/perf. A sidegrade isn’t the end of the world but a badly overpriced sidegrade is dead on arrival. Idk what Intel is doing.
  - FirmwareBurner 1y ago
    Where do you live? Because Intel Arc cards ARE available at MSRP almost everywhere in western nations. It really isn't a paper launch.
    - AnotherGoodName 1y ago
      To be fair to the parent they absolutely were a paper launch. Looks like supply has finally caught up now but we’re also a long way from launch.
    - KronisLV 1y ago
      Latvia, when it released over here it was around 350 EUR for a LE B580, not from an individual scalper but a regular e-commerce store that sells all sorts of parts. For comparison's sake, a regular RTX 3060 12 GB (not Ti) was 300 EUR around that time. In other countries, any place that sold them at near-MSRP very much was out of stock immediately (not that there was that much of it to begin with, which is my critique), leaving other vendors to raise the prices to around 350 USD and the more greedy ones and scalpers all the way up to 400 USD, I saw those listings myself: https://www.tomshardware.com/pc-components/gpus/where-to-buy-the-intel-arc-b580 https://www.tomshardware.com/pc-components/gpus/where-to-buy... https://www.digitaltrends.com/computing/intel-arc-b580-out-of-stock/ https://www.digitaltrends.com/computing/intel-arc-b580-out-o... Whether anyone actually bought those is another question entirely, but a GPU that's only available to you at 350 USD but should have been sold for 250 USD (and performs well for that price) is just plainly bad value. It is nice that since the prices have dropped, however the hype around it is already past, so we're in the long tail of the product's lifecycle, especially with things like the CPU driver overhead being identified and getting lots of negative press. They had a chance to move a lot of units at launch thanks to positive reviews from pretty much everyone... and they fumbled it.
tester756 1y ago
The real quote is: >"On training, I think it is too late for us," Not too late for AI, but too late for training meanwhile there's inference opportunity or something like that

baq 1y ago

CEO of a silicon company saying his business is "too late for AI" is a CEO either without a vision or guts, an accountant, the safe option. If it's anywhere close to true, Intel is looking to sell itself for parts.

freedomben 1y ago
Agreed, either their business situation is far more critical than we know, this is a gross indictment of their R&D, or this is malpractice on the part of the leadership
checker659 1y ago
> of a silicon company With their own fabs, at that
moralestapia 1y ago
Well, but if it's true and there's a better strategy, why wouldn't he do it? Seems like you'd prefer yet another +1 selling AI oil and promises ...
h2zizzle 1y ago
Or, a sly way of calling the AI bubble.
tester756 1y ago
The real quote is: >"On training, I think it is too late for us," Not too late for AI, but too late for training meanwhile there's inference opportunity or something like that
aDyslecticCrow 1y ago
Too late for the AI boom if they have to spend another 2 years and manufacturing investments to get a product out for the segment. We are over-inflated on AI hype. Its relevance will remain but betting a company on it isn't a wise idea.
BeetleB 1y ago
There's a whole backstory to this. When he joined only a few months ago, he set the vision of making Intel a worthy participant in the AI space. Then just a few months later, he announced "we cannot compete". What happened in the middle? Recent articles came out about the conflict between him and Frank Yeary, the head of the Intel board. He wanted to acquire a hot AI startup, and Frank opposed it. Two factions were formed in the Board, and they lost a lot of time battling it out. While this was going on, a FAANG came in and bought the startup. I think his announcement that Intel cannot compete was his way of saying "I cannot do it with the current Intel board."
- Scramblejams 1y ago
  What startup was it?
  - BeetleB 1y ago
    The news articles didn't name it.
- horsawlarway 1y ago
  Feels like a fair statement. My read is basically that Intel's board is frustrated they can't part the company out, take their cash, and go home. I'd also be incredibly frustrated working with a board that seems deadset on actively sabotaging the company for short term gains.
- downrightmike 1y ago
  What happened is they fired tens of thousands of their workforce. They knee-capped themselves. Having people with experience and institutional knowledge is required. You can't just toss that out the windows and expect things to work.
  - BeetleB 1y ago
    By any measure, Intel was bloated. All their competitors are doing a lot more with a lot fewer people. Now whether they fired the right tens of thousands is another matter.

phkahler 1y ago

Cutting products that don't have 50 percent margins seems like a bad choice when their goal should be filling their advanced fabs. Keeping that investment at or near capacity should be their goal. They said they'd have to cancel one node if the foundry business couldn't get enough customers, and yet they're willing to cut their own product line? Sure they need to make a profit, but IMHO they should be after volume at this point.

KronisLV 1y ago
Even the Arc B580 GPUs could have been a bigger win if they were actually ever in stock at MSRP, I say that as someone who owns one in my daily driver PC. Yet it seemed oddly close to a paper launch, or nowhere near the demand, to the point where the prices were so far above MSRP that it made the value really bad. Same as how they messed up the Core Ultra desktop launch, of their own volition - by setting the prices so high that they can’t even compete with their own 13th and 14th gen chips, not even mentioning Ryzen CPUs that are mostly better in both absolute terms and in the price/perf. A sidegrade isn’t the end of the world but a badly overpriced sidegrade is dead on arrival. Idk what Intel is doing.
- FirmwareBurner 1y ago
  Where do you live? Because Intel Arc cards ARE available at MSRP almost everywhere in western nations. It really isn't a paper launch.
  - AnotherGoodName 1y ago
    To be fair to the parent they absolutely were a paper launch. Looks like supply has finally caught up now but we’re also a long way from launch.
  - KronisLV 1y ago
    Latvia, when it released over here it was around 350 EUR for a LE B580, not from an individual scalper but a regular e-commerce store that sells all sorts of parts. For comparison's sake, a regular RTX 3060 12 GB (not Ti) was 300 EUR around that time. In other countries, any place that sold them at near-MSRP very much was out of stock immediately (not that there was that much of it to begin with, which is my critique), leaving other vendors to raise the prices to around 350 USD and the more greedy ones and scalpers all the way up to 400 USD, I saw those listings myself: https://www.tomshardware.com/pc-components/gpus/where-to-buy-the-intel-arc-b580 https://www.tomshardware.com/pc-components/gpus/where-to-buy... https://www.digitaltrends.com/computing/intel-arc-b580-out-of-stock/ https://www.digitaltrends.com/computing/intel-arc-b580-out-o... Whether anyone actually bought those is another question entirely, but a GPU that's only available to you at 350 USD but should have been sold for 250 USD (and performs well for that price) is just plainly bad value. It is nice that since the prices have dropped, however the hype around it is already past, so we're in the long tail of the product's lifecycle, especially with things like the CPU driver overhead being identified and getting lots of negative press. They had a chance to move a lot of units at launch thanks to positive reviews from pretty much everyone... and they fumbled it.

tester756 1y ago

The real quote is: >"On training, I think it is too late for us," Not too late for AI, but too late for training meanwhile there's inference opportunity or something like that