Shares of Intel reacted poorly to the news that Apple will no longer need Intel chips and has fully transitioned to its own silicon.
Intel Corporation (NASDAQ: INTC) shares fell following Appleโs (NASDAQ: AAPL) announcement that its new Mac Pro will use M2 Ultra, a new company-built chip. Apple said the M2 Ultra is three times faster than Appleโs fastest Mac Pro computer with an Intel chip. INTC fell nearly 5% on the day and closed at $29.86
Apple said the new Mac Pro will feature up to 192GB and start at $6,999. Apple also announced the Mac Studio and the Mac Pro, describing both products as the โtwo most powerful Macs ever made.โ Furthermore, Apple said the Mac Pro โcompletes the Mac transition to Apple silicon. In 2020, Apple first launched its own chip, the M1, to much success.
Apple said the new Mac Pro computer will start at $6.999
Intel Struggles Outside of Mac Pro and Mac Studio Transition to In-House Silicon
Intel shares may continue their plunge following Appleโs move to its own chips. The company will have to double its efforts at snapping a sizable market share considering competition from rival semiconductor company AMDย (NASDAQ: AMD). The AMD companyโs chips have been instrumental to data centers as well as personal computers.
In addition to AMD, Intel also has to worry aboutย Nvidiaย (NASDAQ: NVDA). Since the AI boom, Nvidia has gained ground as its chips have been in high demand for AI services.
In addition to fighting competition, Intelโs numbers have not been impressive. In April, the companyย reportedย figures for Q1 2023, which showed the largest quarterly loss in the companyโs history. The Q1 results also showed that Intel saw its second consecutive quarter of losses. In addition, the first quarter was Intelโs fifth straight quarter recording reduced sales.
According to the report, Intelโs quarterly revenue fell to $11.7 billion, a 36% year-over-year (YoY) plunge. Furthermore, the company suffered a 133% annual earnings per share reduction. GAAP loss per share was recorded as $0.66, with non-GAAP loss per share at $0.04.
Intel has also discontinued its line of Bitcoin mining chips. Only a year after announcing the Blocksale application-specific integrated circuit (ASIC), itย announcedย in April that it would stop taking orders in October. Intel also estimates it will ship the last Blocksale ASIC latest by April 20, 2024. According to a spokesperson quoted in a Reutersย report, Intel ended the Blocksale 1000 Series ASIC line to prioritize IDM 2.0. The companyโs IDM 2.0 strategy is to outsource chip-making while focusing on smaller and faster options.
Apple Completely Moves Away from Intel
An official Appleย press releaseย announcing the Mac Studio and the Mac Pro describes the computersโ respective M2 Max and M2 Ultra chips. Apple said the M2 Max chip is โup to 6x faster than the most powerful Intel-based 27-inch iMac,โ while also touting the Mac Proโs speed.
The Mac Studio is much cheaper than the Mac Pro, starting at $1,999.
Tolu is a cryptocurrency and blockchain enthusiast based in Lagos. He likes to demystify crypto stories to the bare basics so that anyone anywhere can understand without too much background knowledge.
When he’s not neck-deep in crypto stories, Tolu enjoys music, loves to sing and is an avid movie lover.
