If there was one thing that any technology website or news website could happily write on paper for the record, that thing would be that ever since Apple introduced the iPad in to the world and ever since other mainstream manufacturers started to create tablet computers, the PC market began to decline subsequently. It has been noted naturally then that the rise of mobile connected devices, namely those mentioned tablets and smartphones, have led to a sales decline for multiple PC vendors and also select component suppliers.
With the above in mind Intel have cut their Q3 sales target as the demand for PC’s has declined throughout 2012, with analysts polled by Thomson/Reuters estimating that Intel’s third quarter revenue hit $14.2 billion, with a profit of 60 cents per share, which is down 13% from 69 cents in the year-earlier-period overall.
For those not in the know, Intel invested a whole lot of time and money in to its Ultrabook brand during its incarnation towards the back end of 2011. Despite solid offerings from multiple PC vendors, Ultrabook sales have so far not been anywhere near as high as Intel originally anticipated, although the company will undoubtedly be making a big push during 2013 after Windows 8 has began to gather momentum. On their sales target’s, Intel said in a blog post recently:
Relative to the prior forecast, the company is seeing customers reducing inventory in the supply chain versus the normal growth in third-quarter inventory; softness in the enterprise PC market segment; and slowing emerging market demand. The data center business is meeting expectations.
The company’s expectation for third-quarter gross margin is now 62 percent, plus or minus one percentage point; lower than the previous expectation of 63 percent, plus or minus a couple of percentage points.
From the above, the ‘slowing emerging market’ part sticks with us for a very good reason; as an emerging market, Ultrabooks are Intel’s latest hope of bringing new life to the Windows powered PC market. The company isn’t even remotely well positioned within the mobile market currently, losing out to companies like ARM and Qualcomm heavily, and as such they desperately need the Ultrabook brand to work in order to stir up new interest from OEM’s and generate more sales from a declining market.
Of course, it could help them a lot if they simply lowered the prices for their processors by even a small amount, as it is estimated that an Intel processor makes up around 40% of the cost of an Ultrabook and in cases even more. If you ask us, the way in which Ultrabooks are going to sell more (and enough to please investors) is by lowering the cost of processors enough so that the end price of an Ultrabook to the consumer is around £500 with decent specifications. If this price is right, people will buy them.
For more information on Intel’s statement regarding sales targets, hit up our source link below.
Source: Intel News Room