Galaxy S23 Leak ChatGPT and Bing Father of Big Bang Theory 'The Last of Us' Recap Manage Seasonal Depression Tax Refunds and Identity Theft Siri's Hidden Talents Best Smart Thermostats
Want CNET to notify you of price drops and the latest stories?
No, thank you

Intel by the numbers

Since releasing its first microprocessor in 1971, Intel (INTC) has become one of the largest and most profitable corporations in the world. Like oil companies, telecommuncations giants, and other megacorporations, its success has pretty much depended on one product.

Intel by the numbers
By Mike Kanellos
September 4, 1997, 12:00 p.m. PT

special report Since releasing its first microprocessor in 1971, Intel (INTC) has become one of the largest and most profitable corporations in the world. Like oil companies, telecommuncations giants, and other megacorporations, its success has pretty much depended on one product.

Intel by the numbers, 1996
Revenue: $20.85 billion
by region: North America
Earnings: $5.157 billion ($5.81 per share)
Revenue by sector (estimate)
Microprocessors: $14.9 billion
Chipsets: $1.4 billion
Motherboards: $1.2-2.0 billion
Networking: $1.0-2.0 billion
Flash Memory: $950 million
Embedded controllers: $530 million
Videoconferencing: $33.5 million
Sources: Intel; Dataquest

Since releasing its first microprocessor on November 15, 1971, Intel has produced 18 generations. Its first chip was the 4004.

Intel accounted for $14.9 of $18.8 billion in worldwide microprocessor sales in 1996. This translates to a 79.4 percent market share by revenue and 28 percent share by unit sales.

Within the computing field (microprocessors are used in servers, desktops, laptops, and workstations), Intel accounted for $14.6 out of $16.6 billion in total sales in 1996. Intel earned 88 percent of the market by revenue and 77 percent by units shipped. Within the X86 market, Intel held a 95 percent market share. (source: Nathan Brookwood, Dataquest)

Approximately 10 to 12 million units shipped in 1996, accounting for $1.2 billion or more in revenue, Brookwood estimated. Mario Morales, director of semiconductor research at International Data Corporation, puts the total closer to $2 billion. In conjunction with board facilities, Intel also manufactures limited numbers of computers that incorporate Intel boards, said other sources. Intel partners have often questioned whether this is Intel's springboard into desktop computing.

Intel recently announced the 440LX chipset, which will be the basis for 3D desktop computing. Although other manufacturers were operating in the field, Intel's entry effectively chased them out, said several sources. Intel chipsets now have 100 percent "attach rate" with sales of microprocessors, according to Southcoast Capital, giving it a market share equal to that of the processors.

However, Advanced Micro Devices has released its own chipset.

Graphics products
Intel entered this market in 1997 with the purchase of Chips and Technologies. For fiscal 1997, Chips reported $168 million in revenue and $36.2 million in earnings. The company accounted for approximately 47 percent of notebook graphics chips and 9 percent of the desktop market.

"With graphics, [Intel] could hit a 50 percent attach rate in a couple of years," said Ashok Kumar, Southcoast Capital.

Flash memory
Intel pulled in approximately 33 percent of market in 1996, according to Jim Handy, memory analyst at Dataquest. Revenue came to $950 million.

"Where Intel is selling a good bit of memory is in cell phones and auto engine controllers. The stuff that sells into a PC they shy away from," said Handy.

Embedded products
Intel ranks fifth in this market with a seven percent share, according to Tom Starnes, principal analyst, embedded products, at Dataquest. "In the embedded market, there is a world of different processors and different needs," he said. Besides coming in wider varieties, embedded processors, which act as the brain center in navigation devices, appliances, and other non-PC appliances, aren't nearly as profitable as microprocessors.

The chips sell for between $2 and $25 and carry relatively low margins. Overall, the market accounts for around $15 billion in sales. Motorola ranks first here with a 17 percent share. AMD is another active participant.

Although Intel will encourage hardware vendors to make devices that use embedded processors, don't look for the company to become a driving force in this area, added Starnes. Intel will not likely try to become the market leader in this area, he said.

Intel entered the market in 1979 as part of team to develop a 10-mbps Ethernet specification. Since then, the company has released a series of interface cards, hubs, and switches. Router technology will likely follow through the purchase of Case Technology earlier this year.

While representing a relatively small market share, "They are obviously well recognized," said Esmerelda Silva, an analyst at IDC.

Intel is in a neck-and-neck race for share with Picturetel in this still-small market. In 1995, Intel shipped 22,500 desktop videoconferencing units, more than Picturetel, but was second behind Picturetel in terms of video conferencing revenue, with $33.2 million, said Sujata Ramnarayan, multimedia analyst at Dataquest. Figures for 1996, which are not yet in, are expected to be similar.

Competition in the market should increase in the future, she added. Sony and other vendors are expected to enter the field, creating pricing pressures. While Intel has primarily marketed only desktop systems, the company this past May released its first group videoconferencing system, a market segment that PictureTel currently dominates.

Intel is an investor in CNET: The Computer Network. end

Back to main story   next

  Inside Intel

  Latest Headlines
display on desktop