The worst crisis in ten years! Global chip giants plummeted 177.5 billion

category:Finance
 The worst crisis in ten years! Global chip giants plummeted 177.5 billion


It is worth noting that the U.S. chip giant Intel closed down 10.58% on Friday due to its unsatisfactory performance. Its market value evaporated by 26.56 billion US dollars (about 177.5 billion yuan). At present, the total market value of Intel is 224.6 billion US dollars.

White House economic adviser Kudrow:

There has not been much progress in stimulus negotiations

On Friday, White House economic adviser Larry Kudrow said talks on the stimulus package were not making much progress. Not much has changed at the moment. Time is passing quickly, he says. I dont want to make any predictions..

On Thursday, House Speaker Nancy Pelosi said she and Treasury Secretary Steven mnuchin are close to reaching a consensus on a key part of the stimulus package, but there are still big differences between the two sides that need to be resolved through consultation.

Pelosi pointed out that she and mnuchin were close to reaching an agreement on how to allocate funds for virus testing and contact tracing in order to safely reopen schools and the economy, which was a key part of her talks. She said three key sticking points remain unresolved: Democrats demand for aid to state and local governments, aid for schools, and Republicans insistence on allowing employers to exempt part of their responsibilities.

We will continue to negotiate and I hope that an agreement can be reached, Pelosi said at a news conference on Thursday. She earlier told MSNBC that my hope was to finalize the fiscal stimulus before the November 3 election; but she pointed out that Senate Majority Leader Mitch McConnell publicly opposed the size of the stimulus package under discussion.

Senate Republicans remain the ultimate obstacle to the roughly $2 trillion deal that Pelosi and mnuchin negotiated. McConnell made no commitment on when the Senate could reach any compromise, and some senior Republican lawmakers doubted whether the house would vote, even after the election.

Data center business revenue is lower than expected

Intel plummeted by more than 10%

Under the epidemic situation, Intel failed to hand over the performance report that satisfied the market. Intel closed down more than 10% on Friday.

After the U.S. stock market on October 22, Intel released the third quarter performance report of fiscal year 2020. According to the financial report, Intels revenue in this quarter was 18.33 billion U.S. dollars, down 4% year-on-year, slightly higher than market expectations in July; net profit was $4.28 billion, down 28.6% year-on-year.

At the same days financial report, Intels chief financial officer, George Davis, said the demand for personal computers shifted from desktop computers and high-end commercial PCs to entry-level consumer and educational products. Despite the increase in sales, the average selling price fell, which affected the profit.

The data center business selling server chips is the main source of Intels profits. Due to the weak economy affecting sales to large companies and government customers, in the third quarter, Intels revenue from the data center business group was $5.91 billion, down 7% year-on-year, 4.8% less than the markets expected $6.21 billion. Intel also expects orders related to cloud servers to slow down.

Photo source: photo web

Some commentators believe that the financial report confirmed that Intel is still in the deepest crisis in at least a decade. In the past three decades, although other U.S. chip companies have either closed down or sold parts manufacturing plants, Intel has insisted that it can improve its operations and design and manufacture of semiconductors. Today, such a strategy is being questioned.

In a conference call after the earnings announcement, Intel chief executive Bob Swan said he was still deciding how many products to outsource. Executives also said the new crown epidemic increased the demand for cheap chips, which impacted the companys data center business and predicted that these adverse factors would pass.

Cody Acree, an analyst at loop capital markets, said he did not accept Intels blame for the decline in data center performance on the epidemic. He believed that the increase in demand for personal computers in the past few months showed that the impact of the epidemic on market demand was not so great.

Chief financial officer George Davis said Intels cloud business is doing well, but it is likely to slow down in the next quarter. He also said demand for other types of data center customers (companies and governments) fell 47% in the third quarter after growth in the first half.

Intel is developing 7-nanometer chip manufacturing technology, but it is delayed due to technical reasons. Due to the companys poor R & D on 7-nanometer chip products, Intel is not favored by the market. Now its stock price is only two-thirds of that of its old rival AMD, and its total market value is lower than NVIDIA.

Intel said its own 7-nanometer chip will not be available until the second half of 2022 to the beginning of 2023. In the future, the company said in a conference call on July 24 that the 7-nanometer chip could be produced by a third-party foundry in the future. In the financial report meeting, Intel CEO Ruibo said that he would make a decision in January next year.

$9 billion sale of NAND flash and memory business

Intel is gradually shrinking its battle lines and focusing on its core business.

After selling baseband chip business and connecting chip business, Intel made a cut again.

On October 20, South Korea local time, SK Hynix officially announced that it would purchase Intel NAND flash memory and memory business for $9 billion.

This transaction does not include xpoint and other related businesses jointly developed by MgO and Intel. The core business of this transaction includes Intel nandssd business, NAND parts and wafer business and related technologies, as well as Intels Fab68 flash memory manufacturing plant built and operated in Dalian, China for many years.

After the transaction is reviewed by the relevant technology and asset departments of Korea and the United States, SK Hercules will accept all flash businesses belonging to Intel, the six largest flash plants in the world.

Intels CPUs have been delayed in this generation. They need to focus more on CPUs than on non core businesses. Industry sources said.

In recent years, Intel has been plagued by NAND business. The official disclosed that it plans to use the funds obtained from this transaction to develop industry-leading products and strengthen key businesses with long-term growth potential, including artificial intelligence, 5g network and edge equipment related to automatic driving. In the third quarter, although the average selling price increased year on year, Intels memory business revenue fell 11% year-on-year. For Intel, the only key point behind the risk is capital. The company needs a large amount of capital investment to maintain the R & D needs, and also needs to maintain the operation of business lines. What you can see is that not only competitors are investing heavily in capital, but also customers like apple recently announced that they will invest billions of dollars to transfer MAC products from Intel chips to armcpu. Source: Daily Economic News Editor: Guo Chenqi_ NBJ9931

In recent years, Intel has been plagued by NAND business. The official disclosed that it plans to use the funds obtained from this transaction to develop industry-leading products and strengthen key businesses with long-term growth potential, including artificial intelligence, 5g network and edge equipment related to automatic driving. In the third quarter, although the average selling price increased year on year, Intels memory business revenue fell 11% year-on-year.

For Intel, the only key point behind the risk is capital. The company needs a large amount of capital investment to maintain the R & D needs, and also needs to maintain the operation of business lines. What you can see is that not only competitors are investing heavily in capital, but also customers like apple recently announced that they will invest billions of dollars to transfer MAC products from Intel chips to armcpu.