Market Insight

Intel takes the gloves off, hitting back at the competition

April 16, 2019  | Subscribers Only

Vladimir Galabov Vladimir Galabov Principal Analyst, Data Center Compute
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In 2018, Intel’s data center–targeted products brought in their highest revenue to date. The data center group (DCG), home to Intel’s Xeon CPUs, topped $23B in revenue, up 21% YoY. Intel’s programmable solutions group (PSG) surpassed $2B in revenue for the first time, growing 12% YoY, and we estimate the revenue contribution of FPGAs going into data center (DC) servers increased to 16% of total FPGA revenue. Intel’s SSD and memory group (NSG) brought in over $4B in revenue, up 22% YoY. Yet the competitive threat Intel faces in the DC grew, spoiling the vendor’s 2019 growth outlook: AMD CPUs reached 5% share of servers shipped in 4Q18, up from 1% in 4Q17, Arm-based CPUs from Cavium and Amazon were launched, and NVIDIA made almost $3B from selling co-processors for AI and visualization in the DC. To add to the fire, startups like Cambricon and Graphcore started shipping AI-targeted co-processors with Fujitsu, Huawei, and Alibaba announcing intent to join the race. Although Intel’s DC businesses generated record revenue in 2018, the vendor exited the year with a tough job ahead when it comes to building on that momentum as others ramp their efforts to get a piece of the pie.

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