Intel losing billions on tablet and smartphone chips

Intel losing billions on tablet and smartphone chips

Intel is still having hard time competing in the mobile chip business, which is still dominated by Qualcomm and few smaller rivals like MediaTek, NVidia, Allrunner, RockChip and others. In addition, we also have an increasing number of handset makers relying on their own solutions, including Apple, Samsung and Huawei, with ZTE and LG looking to join this trend in the near future. So we’re not surprised to learn how much money Intel keeps losing every year.

In 2012, Intel’s mobile chip division lost $1.78 billion, and then $3.15 billion a year later. At the end of the first quarter of 2014, the Mobile and Communications Group saw a $929 million operating loss on $156 million in revenue.

One gotta wonder – should Intel simply leave this market to those who actually make some money along the way? They disagree and believe this division will bring-in some serious cash, eventually. “We have a roadmap to profitability,” the company noted.

Presuming everything goes as planned, the first Intel chips with integrated 4G LTE connectivity will be released in late 2015 or early 2016. As a reminder, integrated cellular connectivity comes included with pretty much all modern chips, making life easier for handset makers. That said we’re not surprised that Intel is still focusing its effort on tablets which are more often than not sold with Wi-Fi connectivity, only.

Meanwhile, the chip making giant is benefiting from the rising Internet of Things trend, having managed to hit nearly a half-billion in sales each and every quarter. Overall, Intel made $1.9 billion in profit on $12.8 billion of revenue in the first quarter.

[Via: TheVerge]

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