Company’s turnaround still a ‘longer-term story’

00:00 Speaker A

Now there is Bob O’Donnell. President and an analyst chief at Technalysis Research. Bob, Intel, stocks exploding here for hours. What are you doing from these results?

00:13 Bob O’donnell

You know, when you just argued, so, look, the income numbers for this quarter were higher than expected, and most importantly, of course, the prediction was higher. I mean, there were difficulties, and I just understand the point you discuss. Intel, I believe that they want to be both a chip manufacturer and a chip designer and they really try to understand this way. Look, lip boo is just quarter. The changes they need to make are quarter long, right? I mean, this is a very quarter, realistic, probably a multi -year full return story before all the benefits begin to emerge. A few interesting things.

01:05 Speaker A

Let me ask you Bob, just to stop you there because I think you touch an important point. I have many questions about the metrics of this edition, Bob and we will enter it, but you talk about an important point, which is a broader question about what Bob, what Intel will be. What is the game plan here? What is the strategy bob? We were talking to our colleague Jen Hawley before, how honest, Bob, we don’t talk about Intel. We’re talking about Nvidia, AMD, Broadcom, Micron. Intel sounds like not in the conversation. So what’s the game plan progresses here?

02:16 Bob O’donnell

Look, the game plan, let’s not forget that they will focus on the X86. I mean, a few hundred million units are still sold every year, and many servers are sold every year. Intel has the majority of CPUs in these systems. And even in Nvidia, you know, big piles, above the shelf, there is an Intel Xeon CPU. Now, as a percentage of the total bomb, now it is still quite small, but there is still a point. So you will see that they build their own products and sell their own products. You will see them, oh, start trying to create more products for other people. This is the casting point. You know, how this thing is built, the reason for such a challenge is that they are so intertwined, you know, trying to do it for other people for themselves. And now, it was painful because they smashed these pieces, right? Obviously, trying to clarify all of this was a great difficulty. Um, and a quick look at the numbers, you know, they are talking about the qualifying of the intersege. You know, when Intel sells what they do to them, don’t you? It became part of the situation because they had to remove it without discussing and separated the documentary business. For external customers, they are now focusing on 14A, UH. 18a will probably be intelly, perhaps a little bit of some of the things they have explained in the past, Microsoft, Amazon, I think a little dod things. However, the biggest focal point for future customers is still coming. Again, if we go back to what I said before, I think it is still a longer term story, and temporarily, they have this difficult situation in which they have to crank the X86 as much as they can renew the PC market again, and strengthen themselves in the server business. They’re pouring most of the other things. You know, they’re just shedding automotive business. UM sold some of Mobilke, who still owns the majority of Mobile. So they have hands to some extent, but you know, they focus on their seeds. Not with a GPU, they are trying to find a better AI strategy because you know, lip said boo, hey, look, we’re not sure we can play that game. However, there are many AI studies in CPUs, many of them have anything to do with software. Intel is actually a more powerful software story than many people realize that they also realize software types and bolts.

06:15 Speaker A

When it comes to this PC job, Bob, I just wonder, you think, you know, can we see that we can shoot about any tariff there? What do you think the tendency looks like?

06:29 Bob O’donnell

You know, these days are impossible for tariff calls. To be honest, Josh. Um, so there was some argument that it happened in this quarter, perhaps it will be again in the next quarter. Oh, it’s really hard to say. As a result, people renew their PCs. We begin to see the integration with NPUs in new systems. You know, in the beginning we saw that Qualcomm did this with a arm processor with Snapdragon XE leaders. Now we’re doing this. There is a stronger NPU. AMD is doing this. Microsoft is pushing this. You know, so we’ll start seeing a larger corporate renewal. In the meantime, I’m not talking about the end of support for Windows 10. This is a very big deal. All this, I think, helps to drive the story around a renewed PC business with the majority of Intel. And so they would benefit the most. But look, it won’t be easy. Obviously, it will be a longer term story, but I think they’re trying to put the pieces in place, and Lip Boo has a strategy and I feel like trying to work.