Remember how weird it was last week when Intel, apropos of nothing, published an open letter to all its partners and customers apologising for its chip manufacturing failures? Well, it’s not seeming so weird now as both HP and Dell have come out in their latest earnings briefings to the city to state that continuing CPU supply problems are having genuine material impact on their own commercial and premium consumer PC shipments.
It was Intel’s GM of marketing, Michelle Johnston Holthaus, who made the apology on behalf of Intel, burying the fact that its chip supply problems were worsening by coating it in the phrase, “production variation.”
Dell has now confirmed that “Intel CPU shortages have worsened quarter-over-quarter,” with vice chairman, Jeff Clarke announcing it in the company’s latest earnings call. In the call he stated that the Intel issues were responsible for changes in Dell’s Q4 forecasts, normally the strongest quarter of the year, which in turn resulted in its stock price dropping 4% after trading ended for the day.
HP also announced (via Seeking Alpha) that Intel’s supply shortages were going to constrain its sales in peak trading times this quarter. So if you’re chasing Black Friday PC deals maybe stock on Intel-based products at least might be drying up quick…
It looks now as if Intel was trying to control the narrative by making the announcement ahead of Dell and HP’s results, where it knew the big PC manufacturers would be calling out Intel’s continued chip supply failings. Unfortunately there’s not really a lot you can control when the bare facts are that you’re unable to supply the most important thing you make – processor silicon – to at least two of your biggest customers.
And that, in turn, will make for great reading to a certain Dr. Su… AMD’s CEO will have been watching all this with a certain glee, not for a fellow semiconductor company’s struggles, but because any supply constraint could end up driving more and more customers into the welcoming arms of AMD.
Especially now that it has proven momentum with a third successive generation of processors – in desktop and datacentre – releasing on time and to great critical acclaim. The Ryzen 3000 chips sit at the top of our best CPU lists, 3rd Gen Threadripper is tearing it up in the productivity stakes, and the latest EPYC CPUs are storming servers far and wide.
These are worrying times for Intel, especially when you see previously lauded high profile acquisitions starting to drift away from the company. Jon Carvil left for Nuvia this month and now both Chris Hook and Heather Lennon have jumped ship too. If Raja goes anywhere the whole Intel Xe GPU ship could sink…