Intel Corp., the world’s largest maker of central processing units, said that shipments of mobile processors grew tremendously in Q3 2009, which allowed the company to post better-than-expected financial results for the quarter. What is even more noteworthy is that Atom and associated chipsets now represent over $1 billion dollar business for Intel, a situation that no one could foresee just about two years ago.
During the third quarter of fiscal 2009, Intel shipped record amount of microprocessors and chipsets. Mobility Group revenue was up 19%, Digital Enterprise Group revenue was up 14%, and Intel Atom microprocessor and chipset revenue was up 15% to $415 million, all sequentially. Intel’s third quarter revenue was $9.4 billion. The company reported operating income of $2.6 billion, net income of $1.9 billion and earnings per share (EPS) of 33 cents.
“[Sales of] Atom and the associated chipsets were a bit above $400 million, it was $415 million. Year-to-date, we have sold over, or right at, $1 billion worth of Atom and associated chipsets,” said Stacy Smith, chief financial officer of Intel.
Intel Atom central processing units (CPUs) are not meant to perform, moreover, supporting chipsets do not feature the latest multimedia or security technologies; in fact, the Atom platform is aimed at very basic tasks. It is rather obvious that revenues of Atom and supporting logic this year will be in the range between $1.3 and $1.5 billion as netbook shipments will be skyrocketing. The overall trend seems to be quite interesting: many people do not need performance or features from their PCs, which may be an alarming sign for CPU makers.
The Atom is an important technology for Intel going forward since with its ultra low power chips as well as system-on-chip devices Intel will be able to target consumer electronics or handset markets. In fact, Intel claims that it already has design wins in certain untouched sectors.
“The consumer electronics and ultra mobile activities are proceeding nicely in terms of design wins and product development but the volume there is really out in time a bit,” said Paul Otellini, chief executive officer of Intel.
But while Atom is exceeding any expectations, fully-fledged mobile platforms still remain more popular among end-users, Intel stressed.
We saw the sequential unit growth rate of notebook processors and chipsets actually exceed the growth rate of Atom processors and chipsets. While Atom and netbooks are important growth drivers for us, our traditional notebook business remains one of the primary drivers of revenue growth and we expect that to continue in the future,” claimed Mr. Otellini.