Intel's PC Business Grows in Q4, but Server Chip Sales Still Lag
CEO Brian Krzanich said new form factors helped fuel a slight rebound in PC chips, but U.S. government budget battles helped hold back enterprise business.Just as Intel officials began to see a little life in its PC chips business in the most recent financial quarter, sales of its enterprise servers showed more softness than expected. Like many tech vendors that are closely tied to the ailing global PC space, Intel's financial numbers over the past couple of years have been impacted by the declining sales of desktops and notebooks. However, in the fourth quarter of 2013, the giant chip maker saw revenues of its PC Client Group grow 2 percent over the previous quarter, and remain flat over the same period last year. The PC desktop business was particularly strong, according to CEO Brian Krzanich, with quarterly revenues growing 11 percent. In addition, the company saw record shipments of systems powered by Intel's Core i5 and i7 chips during the quarter. Much of the bump in desktops was in corporate systems, which was in part due to the migration of companies from Microsoft's aged Windows XP operating system to Windows 7 or 8, Krzanich said during a Jan. 16 conference call with analysts and journalists to discuss the financial numbers. He also said the new form factors hitting the market—such as all-in-one and 2-in-1 systems, which can be used as both a notebook and a tablet—has helped boost the PC numbers. Intel has been a strong proponent of such form factors as a way to rejuvenate the PC market, pushing both its Core "Haswell" chips and low-power Atom platform for such systems.
"That really … has to do with a lot of great form factors that are coming in the all-in-ones, the great innovation that’s coming in there," Krzanich said. "We saw some of the highest units of i5 and i7 in the enthusiast area. I think those are some great gaming platforms. So we think there is a lot more to the desktop growth. We also introduced the Haswell-based NUC [Next Unit of Computing], which is a smallest form factor desktop machine that you can have. So it’s those kinds of innovations that are driving this desktop growth as much and more than the software transition."