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24 September 2012

Intel wants to reinvent computing--again

Intel stays mum on its new smartphone strategy, but it has plenty to say about PC processors.

FORTUNE -- A week after slashing its third-quarter sales forecast due to sluggish demand for PCs, Intel kicked off its annual developer conference with a promise to reinvent computing.

The world's largest chipmaker unveiled its latest processor line, Haswell, due out in 2013. The next-generation, lower-power Intel Core processor family will enable "faster, thinner, better" devices and enable longer battery life, said David Perlmutter, Intel's chief product officer.

Perlmutter, a long-time Intel (INTC) exec, delivered the news at a keynote address Tuesday morning (interestingly, company CEO Paul Otellini was a no-show). Intel tried to play up the new capabilities on upcoming ultrabooks, like advanced voice and gesture recognition and built-in NFC. Perlmutter also showed off Intel-powered hybrid tablets and laptops, saying people want different form factors, and touted upcoming Windows 8 devices that will be powered by Intel. Products that run on the long-awaited Microsoft (MSFT) operating system are expected to start launching in late October, so it's too early to tell how consumers will respond.

Meanwhile, demand for PCs is slowing, as Intel recently said in its updated forecast. Corporations are ordering fewer PCs, and as a result manufacturers are reducing inventories, which cuts into Intel's sales (the company now expects revenue of between $12.9 billion and $13.5 billion in the current quarter, down from a previous forecast of between $13.8 billion and $14.8 billion). According to a recent report from Forrester Research, global corporate spending on "Wintel" PCs and tablets will be down by three percent in 2012 and flat in 2013.

Intel's facing even more pressure in the mobile chip market, currently dominated by rival Qualcomm (QCOM) and other players. The company had nothing new to report on its smartphone strategy, though Perlmutter said they are making steady progress and are supplying chips to five phonemakers.

"We are going to announce more partners when they come, and they're coming," said Perlmutter.


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