A former Intel employee has been accused of stealing thousands of sensitive files after being let go during mass layoffs earlier this year.

Thousands of staff were caught up in layoffs after Lip Bu-Tan took over the reins at the struggling chipmaker in March, and Jingeng Luo was among those affected.

After working for Intel since 2014 and receiving notice in July, Luo is accused of using his last few weeks in the office to download thousands of files, including sensitive documents, sparking a lawsuit from Intel seeking damages of $250,000.

The incident highlights the potential risk of insider threats — of particular relevance as the tech industry undergoes plenty of layoffs.

Earlier this year, a 55-year-old was convicted of causing intentional damage to protected computers for a campaign of internal sabotage at his employer, power management company Eaton Corp, after he saw a reduction in his responsibilities at work.

Davis Lu reportedly created "infinite loops" that prevented users from logging into their accounts, wreaking havoc for colleagues.

And last year, a disgruntled IT worker was arrested after targeting a former employee with an extortion campaign that included changing admin passwords and shutting down servers if $750,000 in bitcoin wasn't paid.

What happened?

Luo was told he was being laid off on 7 July, with his contract ending 31 July. A few weeks after being informed, Luo is accused of attempting to download a file from his Intel-provided laptop to an external hard drive, but Intel's internal controls blocked the transfer.

That didn't raise any red flags on the system, however, so he had a second go, according to a court document filed by Intel.

Five days later, according to the allegations, he tried again, using a NAS device — and this time it worked. Over the next four days, Luo downloaded and transferred nearly 18,000 documents, including files marked as "top secret".

Intel said the data transfer was detected internally and sparked an investigation.

Intel said in the court filing that Luo held an engineering position with access to a wide range of confidential information, including data classified as "top secret" and worked on projects that Intel "zealously protected from external disclosure."

$250,000 complaint

Intel said it attempted to contact Luo multiple times over several months to return the files, but the former staffer isn't responding to emails, letters or phone calls, so it filed suit.

The chipmaker said that Luo has “refused to even engage with Intel, let alone return the files, provide the NAS device for examination, or otherwise cooperate with Intel's investigation."

The company is claiming damages of at least $250,000. Luo is believed to be based in Washington state or Oregon, and has not yet publicly responded to the allegations.

Intel noted that Luo signed an agreement to hold such data in strict confidence, and return all data at the end of his employment. Generally, Intel has policies which ban external devices from being connected to company computers or networks.

"Luo’s continued silence demonstrates that he has no intention of cooperating with Intel in any capacity despite his contractual obligation to do so," Intel's court filing noted.

MORE FROM ITPRO

• Nvidia’s Intel investment just gave it the perfect inroad to lucrative new markets
• The US government's Intel deal explained
• Intel to axe 24,000 roles, cancel factory plans in sweeping cost-cutting move

Nvidia plans to invest $5 billion in Intel in a move analysts say will help the chip giant branch out into lucrative new markets.

Announced this week, the partnership will see the two rivals collaborate on data center and PC hardware. The immediate aim is to ensure Intel’s data center architecture – in particular its x86 ecosystem – can connect to Nvidia’s via its proprietary NVLink technology.

In time this will yield Intel-built, custom CPUs for Nvidia that will connect its market-leading GPUs within data centers.

The pair will also collaborate on new hardware in the consumer PC market, with Intel set to build x86 system-on-chips (SoCs) that will complement Nvidia’s RTX range of graphics cards, used for gaming and graphics-intensive applications such as computer assisted design (CAD) software.

“Intel’s x86 architecture has been foundational to modern computing for decades — and we are innovating across our portfolio to enable the workloads of the future,” said Lip-Bu Tan, CEO of Intel.

“Intel’s leading data center and client computing platforms, combined with our process technology, manufacturing and advanced packaging capabilities, will complement Nvidia's AI and accelerated computing leadership to enable new breakthroughs for the industry,” he added.

“We appreciate the confidence Jensen and the Nvidia team have placed in us with their investment and look forward to the work ahead as we innovate for customers and grow our business.”

Nvidia is the big winner

Intel has struggled in recent years to curb Nvidia’s meteoric rise to becoming not only the largest chip company, but also the most valuable company in the world.

The former chip titan’s shares fell 60% in 2024, the same year the firm slashed 15,000 roles and missed its own targets for AI hardware dominance.

Tan’s time as leader so far has been marked by a sharp strategic shift and stabilizing financials, though the firm still reported a net loss of $2.9 billion in its Q2 earnings statement.

In this light, the announcement with Nvidia could come as welcome news to Intel shareholders and help the company increase its US spending. Mario Morales, group vice president, Enabling Technologies and Semiconductors at IDC, said the partnership will be seen as a “positive move for both companies”.

Nvidia, however, will likely be the big winner given it now has an opportunity to capitalize on a broader array of markets.

“They are leveraging each other's strengths to deliver products to customers, particularly in the enterprise sector,” he said.

“This collaboration will help Nvidia expand into new markets beyond the data center, focusing on AI inferencing across various endpoints like PCs, smartphones, and autonomous systems that can leverage a collection of compute chiplets and dry the requirements of performance efficiency.”

The partnership comes just weeks after the US government took a 10% stake in Intel for $8.9 billion, amid financial woes, layoffs, and criticism of CEO Lip-Bu Tan by President Trump.

Under the terms of the deal, the purchase will be financed with a remaining grant of $5.7 billion from the US CHIPS Act and $3.2 billion from the Secure Enclave program – both legacies of the Biden administration.

The funding comes with the caveat of all spending needing to be carried out within the US, in alignment with each act’s stated aim of improving the US semiconductor industry and making it more competitive with China.

In the wake of tech tariffs and a greater focus by the Trump administration on domestic manufacturing, Nvidia has also been under pressure to reduce its reliance on firms such as Taiwan-based TSMC.

Its partnership with Intel will push it closer to US-centric operations, though the chip giant still heavily depends on TSMC, which produces 90% of the world’s advanced chips.

“The announcement today highlights the ongoing AI race between the US and China,” Morales added.

“While the US currently leads in technology, China is rapidly advancing with its own AI initiatives. The collaboration between Nvidia and Intel is seen as a strategic move to maintain US leadership in AI technology infrastructure and endpoints.”

MORE FROM ITPRO

• UK to host largest European GPU cluster under £11 billion Nvidia investment plans
• Jensen Huang says AI will make workers ‘busier in the future’
• Nvidia hails ‘another leap in the frontier of AI computing’ with Rubin GPU launch

The US government has taken a 10% stake in Intel, giving the company access to billions in funds to build factories and conduct research – but what exactly does the move mean for the ailing chipmaker?

Under the terms of the long-rumored deal, the Trump administration has bought a 9.9% stake in Intel for $8.9 billion — Reuters noted that works out to $20.47 per share, a discount of about $4 from the company's Friday closing price.

The share purchase will be paid for via two existing grants — agreed but not yet paid — awarded by the previous administration: $5.7bn from the CHIPS act and $3.2bn from the Secure Enclave program.

That doesn't include a $2.2bn tranche of the CHIPS grants that were already paid to Intel. Or, as President Trump said in a post on Truth Social: "The United States paid nothing for these shares, and the shares are now valued at approximately $11 billion dollars."

The nature of those grants requires the funding be spent in the US. Similarly, as part of the deal, the grants are converted into an equity stake, but the terms require the money to be spent inside the US in ways aligned with CHIPS and Secure Enclave.

“As the only semiconductor company that does leading-edge logic R&D and manufacturing in the US, Intel is deeply committed to ensuring the world’s most advanced technologies are American made,” said Intel CEO Lip-Bu Tan.

The deal comes amid a backdrop of a tariffs war that has hit the technology industry hard as well as long-running tensions with China.

Intel's woes

Once the dominant force in the chips market, Intel has struggled to keep up with rivals such as AMD and Nvidia, first during the shift to mobile and now with the rise of generative AI.

At the end of 2024, Intel announced billions in losses — the tech giant's first annual losses since 1986 — followed by cuts to 15% of its job force. Former CEO Pat Gelsinger departed the company after decades, with Intel eventually naming Tan as the new CEO.

Tan swiftly unveiled his own turnaround plans. That included restructuring how the company targets AI and widening its manufacturing to include external clients like rival Nvidia — but also another round of job cuts and the cancellation of chip factories planned in Germany and Poland.

Criticism of new CEO

The deal also reduces, if not resolves, Trump's ongoing — though largely one-sided — war of words with Tan.

Trump said earlier this month that Tan should resign over his ties to Chinese companies, which included hundreds of millions of dollars in investments as well as his role as CEO of Cadence Design, which recently pled guilty to selling software illegally to the Chinese military.

In a social media post, Trump wrote: "The CEO of Intel is highly conflicted and must resign, immediately." Tan replied via a note to staff that he'd always "operated within the highest legal and ethical standards," and called the criticism "misinformation."

As it turns out, there was another solution: cutting a deal.

After a meeting with the Intel CEO, Trump reportedly said of Tan: "He walked in wanting to keep his job and he ended up giving us $10 billion for the United States. So we picked up $10 billion."

That references the requirement that the money be spent investing in American manufacturing and R&D. Intel noted it is already investing more than $100bn to expand its US-based manufacturing facilities, but the money from the new deal is believed to be targeted at speeding up development at Intel's delayed Ohio plant.

Response to the deal

Intel naturally welcomed the agreement. "We are grateful for the confidence the President and the Administration have placed in Intel, and we look forward to working to advance U.S. technology and manufacturing leadership," Tan said in a statement.

In a statement provided by Intel, the deal was welcomed by luminaries from the tech industry. Microsoft CEO Satya Nadella said the deal would "benefit the country", while Dell CEO Michael Dell said he fully supports the agreement.

Dell added it was "great to see Intel and the Trump Administration working together to advance US technology and manufacturing leadership."

AWS CEO Matt Garman said: "We applaud the Trump administration’s efforts to usher in a new era of American innovation in partnership with American companies."

But the deal is not without risks for Intel. The company said in a filing there could be "adverse reactions" to the agreement from investors, employees, and even customers or suppliers, noting that 76% of Intel's sales come from outside the US.

"There could be adverse reactions, immediately or over time, from investors, employees, customers, suppliers, other business or commercial partners, foreign governments or competitors," the filing noted.

"There may also be litigation related to the transaction or otherwise and increased public or political scrutiny with respect to the company."

The deal sparked wider criticism, including one pundit claiming that "Intel should have been sold for car parts three years ago," and others calling it "right-wing socialism" and "pretty darn bonkers."

What's next?

Trump suggested similar deals may be in the pipeline. After announcing the Intel agreement, he told reporters: "I hope I'm going to have many more cases like it."

He later added on social media: "I will make deals like that for our country all day long. I will also help those companies that make such lucrative deals with the United States States [sic]."

The Intel deal follows another agreement with Nvidia and AMD, in which the rival chipmakers are allowed to sell some specific chips to China — but only if they give a 15% cut of those sales to the US government.

MORE FROM ITPRO

• The gloves are off at Intel as new CEO plots major strategy shift
• Intel needs to “get its story right” to turn things around and capitalize on the AI boom
• Intel makes high-level hires while factory workers are warned of layoffs

The US government is reportedly weighing up plans to take a stake in Intel as the chip giant’s troubles continue.

According to reports from Bloomberg, the proposed deal aims to support the company's efforts to expand manufacturing operations across the US.

A key focus here would reportedly be ramping up development of its delayed Ohio manufacturing facility. While initially touted to open this year, the company has repeatedly pushed back the launch date.

While first delayed until late 2026, in February this year Intel admitted the site wouldn’t become operational until 2030-2031.

The reports from Bloomberg come in the wake of sharp criticism from the US administration. Last week, President Donald Trump suggested CEO Lip-Bu Tan resign amid claims over alleged ties to China.

Subsequent talks between Tan and the administration appear to have been productive, with President Trump later hailing the meeting in a post on Truth Social.

"His success and rise is an amazing story," he wrote.

ITPro has approached Intel for comment, but received no response by time of publication.

In a statement given to Bloomberg, a spokesperson for Intel said the company is “deeply committed to supporting President Trump’s efforts to strengthen US technology and manufacturing leadership”.

“We look forward to continuing our work with the Trump Administration to advance these shared priorities, but we are not going to comment on rumors or speculation,” the spokesperson added.

Intel’s long-running woes

Intel has experienced significant troubles in recent years, falling behind competitors such as AMD and, notably, Nvidia, since the advent of the generative AI race. Intel's market value, for example, has halved since 2020.

The company has gone through repeated rounds of layoffs and a restructuring effort. Last month, the company announced plans to cut its global workforce by 15% and cancelled plans to develop new chip factories in Poland and Germany.

Tan’s appointment as CEO earlier this year was viewed at the time as an effort to steady the ship following Pat Gelsinger’s retirement. In the wake of the appointment, reports from Reuters detailed plans for an overhaul of the company’s chip and AI strategies in a bid to breathe new life into the company and reverse sluggish revenue growth.

Any involvement from the Trump administration could represent a lifeline for the semiconductor giant, and the White House has made clear its plans to ramp up domestic manufacturing and support for fellow chip giants in recent months.

Earlier this week, Nvidia and AMD announced an agreement with the administration to pay 15% of revenues from Chinese chip sales.

MORE FROM ITPRO

• Intel makes high-level hires while factory workers are warned of layoffs
• Intel layoffs confirmed as CEO eyes 'sustainable growth'
• Intel needs to “get its story right” to turn things around and capitalize on the AI boom

Nearly three-quarters (71%) of IT leaders view Windows 11 migration as a prime opportunity to overhaul ageing work devices – and they’ve got their eyes fixed on AI PCs.

That’s according to new research from Dell Technologies and Intel, which found a significant portion of tech leaders intend to upgrade to AI PCs during the shift to the new operating system.

Nearly two-thirds (64%), for example, said being able to run AI applications is now “critically” or “extremely” important to their organization.

IT leaders see a number of distinct advantages with AI PCs, the study found, particularly around advanced security features and employee productivity gains – the latter of which has been a recurring talking point for manufacturers in recent months.

Steve Young, senior vice president and managing director for Dell Technologies in the UK, said the switchover to Windows 11 is a “key moment for UK businesses to align their technology with their strategic ambitions”.

“This research shows that forward-thinking leaders are looking beyond the immediate deadline, seizing the chance to upgrade to AI-capable systems to enhance security, improve efficiency and boost productivity."

Windows 11 migration challenges

Windows 11 is by no means a new operating system. Indeed, the OS launched nearly four years ago now and Microsoft has encountered challenges in pushing users to the new operating system.

A key factor here was the huge popularity of Windows 10, which was only recently usurped by its successor in terms of global downloads.

With the end of support deadline for Windows 10 approaching rapidly, Microsoft and security experts alike are urging enterprises to make the shift to prevent being left vulnerable to potential security flaws.

The study from Dell and Intel found that 79% of organisations have now started their transition to Windows 11, with 44% of those somewhere along the way and 35% having completed the move.

Notably, it found 20% are still to begin the process ahead of the October deadline.

Of those that have made the switch, 60% highlighted security improvements as a key benefit. Nearly half (45%), however, noted that software compatibility for existing applications is a concern while hardware compatibility is also top of mind for 35% of respondents.

Potential disruption to operations was also cited as a lingering concern by 32%.

This aligns with previous research on Windows migration challenges, which has proven difficult for some enterprises in recent months. A study from ControlUp in August last year showed enterprise IT leaders were wary of making the switch, with service disruption a point of particular concern.

“In addition to losing technical support, inaction means businesses may rely on less secure devices that can’t keep up with the latest applications," said Louise Quennell, UK senior director for Dell Technologies’ Client Solutions Group.

"By working with trusted partners like Dell and Intel, they can plan a seamless transition to minimize disruption and set them up to thrive in the AI era.”

Small businesses face acute challenges

While enterprises of all sizes face problems with Windows migration, small businesses in particular face acute challenges.

The study from Dell and Intel noted that 62% of SMBs are yet to have started or completed the transition to the new operating system, marking a contrast compared to 79% of all firms.

SMBs typically share similar barriers to adoption with their larger counterparts, however, they’re far more likely to feel it’s unnecessary and a burden on both finances and general operations.

For those that are keen, AI PCs once again represent an opportunity to overhaul their PC fleet. The appetite for AI-powered devices is tempered by whether or not they can truly deliver value, with around a quarter of IT leaders at smaller firms happy to wait until concrete use cases emerge.

"We understand that for small businesses, every investment must have a clear return so the need to upgrade isn't always immediately obvious," said Brian Horsburgh, UK small business country manager for Dell Technologies.

"That's why we focus on making the business case clear: AI PCs with Windows 11 deliver a competitive edge through smarter day-to-day tools and proactive security. We're here to provide tailored guidance and flexible solutions that turn a perceived cost into a clear catalyst for growth.

MORE FROM ITPRO

• AI PCs are becoming a no-brainer for IT decision makers
• Are Copilot+ PCs finally ready for the enterprise?
• Should AI PCs be part of your next hardware refresh?

Intel has announced plans to cut its global workforce by 15% and cancelled plans to build new chip factories in Germany and Poland.

The chip giant's decision comes fresh off the back of its Q2 2025 results, in which it reported flat year-on-year revenue of $12.9 billion, higher than analyst expectations of $11.92 billion but still resulting in an overall net loss of $2.9 billion across the quarter.

In light of the results, the firm has announced a strict new focus on long-term growth and regaining lost market share, to be realized in the short term through cuts.

Intel plans to end the year with approximately 75,000 employees, with its management layers also trimmed by 50%.

"All of this is designed to drive organizational effectiveness and transform our culture. We will become a faster, more agile, and more vibrant company," explained Intel chief executive Lip-Bu Tan in a statement.

"We will eliminate bureaucracy and empower engineers to innovate with greater speed and focus. And we will reduce our costs to enable investments in future growth. These are the building blocks of a new Intel – and we took important steps in the right direction in Q2."

Just last month, Intel announced new senior engineering hires, even as it warned that its wider workforce were facing job cuts. At the time, staff were told the cuts could target 15% to 20% of the workforce.

The firm has also instituted a full return to office (RTO) policy, which will come into effect in September.

Intel's 18A and 14A manufacturing strategies were intended to reduce the firm's reliance on Taiwan Semiconductor Manufacturing Company Limited (TSMC), but have so far not delivered on this promise.

Earlier this month, Tan told employees that Intel is "not in the top 10 semiconductor companies" any longer, according to reporting by OregonLive.

Writing ahead of the results, Alvin Nguyen, senior analyst at Forrester, said that Tan's comments necessitate a clearer strategy on regaining Intel's lost market position.

"Layoffs in the foundry business and the possibility of refocusing customers from 18A onto 14A need to be addressed," Nguyen wrote.

"Intel's 18A was supposed to bring the company back to semiconductor leadership, however, the layoffs impacting foundries around the world could reflect more than just cost-cutting – for example, it could be down to taking a more strategic focus on specific fabric technology and capacity."

As part of efforts to turn around Intel's fortunes, the company made a series of senior engineering appointments.

CEO Lip-Bu Tan is looking to focus on customer relationships and shore up the company's foundry business, cutting staff and reorganizing top management.

And as part of its plans to become a more engineering-focused company, Intel has now hired three chip industry executives for engineering and networking roles.

Greg Ernst, who's been with Intel for more than 20 years, has been named chief revenue officer. He has headed up the company's sales and marketing group (SMG) since May, after leading SMG across the Americas. He will continue to report to Tan.

Meanwhile, Srinivasan Iyengar has been named as senior vice president and fellow, leading a new customer engineering center of excellence and joining the Intel executive team, also reporting to Tan.

He joins the company from Cadence Design Systems, where he led global silicon engineering, working to help customers create best-in-class custom silicon, including a deep focus on hyperscale data center solutions optimized for key workloads.

Jean-Didier Allegrucci, meanwhile, has been named as vice president of AI System on Chip (SoC) engineering, responsible for managing the development of multiple SoCs that will form part of Intel's AI roadmap.

He joins from Rain AI, a startup where he led AI silicon engineering, after spending 17 years at Apple. There, he oversaw the development of more than 30 SoCs used across many of the company's flagship products.

And, finally, Shailendra Desai is to become VP of AI fabric and networking, where he will lead the development of innovative SoC architectures for Intel's AI GPUs and forward-looking roadmap.

Desai joins from Google, where he led silicon engineering, architectural design, and platform solutions across multiple mobile SoCs. He was previously the founder and CEO of Provino Technologies, an SoC startup acquired by Google in 2021. Both Allegrucci and Desai will report to Sachin Katti, Intel's chief technology and AI officer.

"We see significant opportunities ahead to strengthen our product offerings and meet the changing needs of our customers," said Tan.

"Greg, Srini, J-D, and Shailendra are highly accomplished leaders with strong reputations across our ecosystem, and they will each play important roles as we position our business for the future."

However, the news is less good for many other Intel employees, who this week learned that the company is planning to lay off as many as one-fifth of its staff.

"These are difficult actions, but essential to meet our affordability challenges and the current financial position of the company. It drives pain to every individual," Intel manufacturing vice president Naga Chandrasekaran reportedly wrote in a memo to employees.

He said the company is aiming for a cut in numbers of between 15% and 20%, with most of the cuts to take place in July. There are expected to be layoffs at Intel factories around the world, but particularly in Oregon, where the company currently employs 20,000 people.

Intel’s new CEO Lip-Bu Tan has confirmed the company will be cutting its headcount in response to sluggish revenue.

In an investor call, reported by Seeking Alpha, Tan said: “The first quarter was a step in the right direction, but there are no quick fixes as we work to get back on a path to gaining market share and driving sustainable growth.

“I am taking swift actions to drive better execution and operational efficiency while empowering our engineers to create great products. We are going back to basics by listening to our customers and making the changes needed to build the new Intel.”

What he means by this was expounded upon in an email to employees, since published on the company’s website. In it, he reiterated his desire to refocus the company on engineering, which, he said, is why he “elevated our core engineering functions to the ET (executive team)”.

“As we refocus on engineering, we will also remove organizational complexity. Many teams are eight or more layers deep, which creates unnecessary bureaucracy that slows us down,” he said.

Tan added that he had been “surprised to learn that, in recent years, the most important KPI for many managers at Intel has been the size of their teams” adding that this would no longer be the case.

“I'm a big believer in the philosophy that the best leaders get the most done with the fewest people,” he said.

Acknowledging the natural outcome of this decision, Tan said there was “no way around the fact that these critical changes will reduce the size of [Intel’s] workforce”. This will start in Q2, he said, with the company moving “as quickly as possible over the next several months”.

While no solid numbers were laid out in this email or the earnings call, Bloomberg previously reported it could be around 21,000 employees, or 20% of its workforce. This follows 15,000 redundancies made in August 2024, one of outgoing CEO Pat Gelsinger’s final strategic decisions before he left the company in December that year.

Cutting bureaucracy and hybrid hours

In addition to the headcount reductions, Tan also said he would be instructing team leaders to reduce the number of both meetings and meeting attendees.

“It has been eye-opening for me to see how much time and energy is spent on internal administrative work that does not move our business forward,” Tan said, adding that “too much valuable time is being wasted”.

In common with many of his tech CEO peers, Tan is requiring employees to spend more time in the office but stopped short of implementing a full return to office mandate. Instead, Intel will require staff to attend the office four days a week by 1 September.

In common with many other return-to-office mandates, Tan cited collaboration between employees as the primary reason behind this change, saying facilities should be “vibrant hubs of collaboration that reflect our culture in action”.

“When we spend time together in person, it fosters more engaging and productive discussion and debate. It drives better and faster decision-making. And it strengthens our connection with colleagues,” he said.

Intel’s incoming CEO has some big plans for the firm’s business strategy, sources familiar with the matter have told Reuters.

Lip-Bu Tan appears primed to overhaul Intel’s chip and AI strategies to breathe new life into the firm following a rocky period of layoffs and faltering revenue returns.

Tan will restructure the company’s approach to AI as well as cut staff to trim the fat in what the new CEO sees as a bloated and inefficient middle management layer.

The plans, outlined during an internal town hall meeting at Intel, saw the CEO highlight the need to make some “tough decisions,” two people briefed on the meeting have said.

He also wants to revamp the firm’s manufacturing operations which is now targeted at selling semiconductors to outside clients like Nvidia rather than just supplying Intel itself, sources said.

Similarly, performance improvements for Intel’s manufacturing wing, Intel Foundry, are also afoot, with the company embarking on an aggressive campaign to woo potential customers.

The new CEO was announced earlier this month following the retirement of outgoing CEO Pat Gelsinger, who took the reins in 2021. Gelsinger announced plans to retire in December last year amid reports he was being forced out of the company.

Formerly the CEO of Cadence, Tan says he has huge respect for Intel and sees significant opportunities to remake the business in a way that better serves customers and shareholders.

A turbulent time for Intel

The last 18 months have been trying for the chipmaker giant, which announced a massive 15% cut to the workforce last summer, equating to 15,000 members of staff.

At the time, Gelsinger said the move was financial in motivation and in response to sluggish revenue growth. He also cited the firm’s inability to see significant returns from technology trends like AI.

Gartner analyst Alan Priestley told ITPro at the time that Intel needed to address its product side and try to “get its story right” on AI.

“Nvidia got lucky in the right place at the right time with the right products … Intel was not there,” Priestley said.

Since the cuts, Intel has seen some improvement in the AI space. A deal with AWS in September, for example, saw both firms commit to supporting a multi-billion dollar framework between their shared ecosystem.

MORE FROM ITPRO

• Everything you need to know about Intel
• Why Intel is pushing for developers to adopt AI PCs
• Intel just won a 15-year legal battle against EU

Intel has announced its new CEO in the wake of Pat Gelsinger's retirement, naming former board member Lip-Bu Tan as its new leader months after he quit – reportedly over frustrations on the direction the struggling chip maker was taking.

Gelsinger took the reins at Intel in 2001 after departing in 2009, after a 30-year stint at the company that culminated in the CTO role. Gelsinger said he would step down amid reports he was being forced out in December, with David Zinsner and Michelle ‘MJ’ Johnston Holthaus named as interim co-CEOs.

The past few years have been tough for Intel, with the firm placed on the back foot in AI thanks to the dominance of Nvidia. Last year, Intel reported a net loss of more than $18 billion and announced cuts to 15% of its workforce.

Tan previously held a position on Intel's board of directors, but stepped down in August last year. Tan will now take the reins on 18 March. Intel's shares climbed 10% on the news of his appointment.

"I am honored to join Intel as CEO," Tan said in a statement. "I have tremendous respect and admiration for this iconic company, and I see significant opportunities to remake our business in ways that serve our customers better and create value for our shareholders."

Who is Lip-Bu Tan?

Tan was born in Malaysia and studied at Nanyang Technological University in Singapore, before picking up a masters degree in nuclear engineering and an MBA from the University of San Francisco.

A long-time investor in technology via his investment firm, Walden, Tan has funded a wide range of semiconductor and technology businesses in Asia and the US. In 2001, Forbes called him "the pioneer of Asian VC".

Tan also served as CEO of Cadence Design Systems from 2009 to 2021, an Intel supplier.

In its statement confirming his appointment, Intel noted that while leading Cadence, Tan reinvented the company and refocused on "customer centric innovation", with Cadence's revenue more than doubling and stock prices surging 3,200% during his tenure.

Tan has also sat on the boards of HPE and SoftBank, among others, and was appointed to Intel's board in 2022, later taking on oversight of manufacturing operations, according to Reuters.

Tan received the 2002 Robert N. Noyce Award from the Semiconductor Industry Association, with SIA president John Neuffer calling Tan "a true technology visionary".

Executive chair Frank D. Yeary said Tan had a proven track record in the chip industry, making him well placed to lead the chip maker as it plans to drive competition with industry counterparts such as AMD and Nvidia.

"Throughout his long and distinguished career, he has earned a reputation as an innovator who puts customers at the heart of everything he does, delivers differentiated solutions to win in the market and builds high-performance cultures to achieve success," Yeary said in a statement.

"Like many across the industry, I have worked closely with Lip-Bu in the past and have seen firsthand how his relentless attention to customers drives innovation and success," Yeary added.

"We are delighted to have Lip-Bu as our CEO as we work to accelerate our turnaround and capitalize on the significant growth opportunities ahead."

Intel's woes

Tan has plenty of work ahead of him. Though Intel still maintains a strong market share in laptops and PCs, its market share has shrunk amidst fierce competition with AMD. That's been worsened by Intel missing the shift to mobile, and then AI.

While the AI boom has sparked huge demand for chips, Intel has struggled to remain relevant as Nvidia's GPUs dominated that industry and other rivals out-innovated the one time market leader.

The company has struggled for a decade or more, with delays to process improvements that have now largely been pinned on underinvestment. Gelsinger was brought in to get Intel back on track in 2021, eventually announcing a business model shift that would see it manufacture other companies' chips for the first time, offering an alternative to Taiwan's TSMC.

But last year, Intel admitted billions in losses and announced it would cut 15,000 roles, some 15% of its workforce. Months later, reports suggested Gelsinger was pushed out — told to quit or be removed.

"Intel has a powerful and differentiated computing platform, a vast customer installed base and a robust manufacturing footprint that is getting stronger by the day as we rebuild our process technology roadmap," Tan said in a statement.

"I am eager to join the company and build upon the work the entire Intel team has been doing to position our business for the future."

Takeover rumors

Tan said in a letter to Intel employees, seen by Reuters, that he didn't plan to break up the company by splitting its design and manufacturing businesses.

This comes amid reports that a group of chip companies including TSMC, Nvidia, AMD, and Broadcom are seeking to takeover Intel's manufacturing division.

"Intel plays an essential role in the technology ecosystem, both in the US and around the world. And, together, I’m confident we can turn our business around," Tan reportedly said.

The report suggested that TSMC had pitched the idea of taking stakes in a joint venture that would take over and operate Intel's factories. The Taiwanese chip giant would take no more than a 50% stake. The talks are said to be in the early stages.

MORE FROM ITPRO

• Intel needs to “get its story right” to turn things around and capitalize on the AI boom
• Why Intel is pushing for developers to adopt AI PCs
• Intel CEO: AI PC will be "the star of the show” in 2024

Pat Gelsinger, CEO of Intel, has retired from his role following a four-year stint in the hot seat at the chipmaker.

In a statement, the company revealed Gelsinger stepped down from the board of directors, effective 1st December.

Following the news, David Zinsner and Michelle ‘MJ’ Johnston Holthaus have been named as interim co-chief executives as the company begins the search for a new CEO.

Zinsner currently serves as executive vice president and chief financial officer, while Holthaus was recently appointed CEO of Intel Products.

Frank Yeary, independent chair of the Intel board, will serve as interim executive chair during the recruitment process. Yeary noted that while the firm has made “significant progress” in regaining competitiveness in the industry, there is still “much more work to do” moving forward.

“With Dave and MJ’s leadership, we will continue to act with urgency on our priorities: simplifying and strengthening our product portfolio and advancing our manufacturing and foundry capabilities while optimizing our operating expenses and capital. ”

Commenting on his retirement, Gelsinger described his tenure as CEO as the “honor of my lifetime”.

“Today is, of course, bittersweet as this company has been my life for the bulk of my working career. I can look back with pride at all that we have accomplished together.”

Gelsinger retirement marks the end of an era

Gelsinger began his career in the technology industry at Intel, joining the company as a quality control technician in 1979. Since then, he has held several roles at the chipmaker, including becoming its inaugural chief technology officer.

Both Gelsinger and Intel have experienced significant challenges since he assumed the role of chief executive in 2021, however. Prior to taking the top job, Intel was fighting off stiff competition from industry competitors, including AMD and Nvidia.

Nvidia knocked Intel off its perch as the most valuable US chipmaker in 2020, marking a huge moment in the industry. Since then, Intel has scrambled to keep pace with its one-time plucky rival.

The advent of generative AI further propelled Nvidia, with the firm’s market value skyrocketing as enterprises flocked to its GPU and CPUs.

Under Gelsinger, one part of Intel’s masterplan to regain market share was spinning off the Intel Foundry unit as a subsidiary in a bid to streamline operations.

2024 in particular has been a challenging year at Intel, which Gelsinger pointed to in his retirement announcement. In August, the company announced plans to reduce its workforce by 15%, equivalent to around 15,000 roles.

Poor returns on AI were specifically highlighted as a key factor in this round of layoffs. Gelsinger said the move was part of a cost-cutting initiative in response to poor revenue growth.

“It has been a challenging year for all of us as we have made tough but necessary decisions to position Intel for the current market dynamics,” Gelsinger wrote in his retirement statement. “I am forever grateful for the many colleagues around the world who I have worked with as part of the Intel family.”

AMD has announced a 4% cut to its global workforce as part of a realignment of business priorities.

According to a statement sent to ITPro, AMD said it would be taking a number of steps ultimately resulting in a workforce reduction.

"As a part of aligning our resources with our largest growth opportunities, we are taking a number of targeted steps that will unfortunately result in reducing our global workforce by approximately 4%,” the statement said.

AMD did not state what those specific growth opportunities were, though it said it was committed to ensuring impacted employees are treated with respect and are assisted through the transition.

A previous Securities and Exchange Commission (SEC) filing stated that, as of December 2023, AMD employed a total of 26,000 staff members internationally. This means the layoffs could be equivalent to over 1,000 staff members.

The announcement comes after a promising charge in the AI space for AMD, with the firm’s Advancing AI event showing off strong footing in terms of the critical foundations needed for the technology.

At the firm’s Q2 2024 earnings call, AMD reported a 405% increase year-on-year in operating income in its data center unit. One analyst from IDC told ITPro that the firm is in a strong position to push hard on AI in 2025.

The firm’s Q3 earnings resulted in a 7% dip in shares according to reporting from Investopedia, though, with net income falling slightly below some estimates.

AMD isn’t the only chip giant making cuts

The move from AMD follows a raft of workforce cuts at industry rival, Intel, which announced plans to cut 15% of its workforce in August, equivalent to around 15,000 roles across its global workforce.

Speaking at the time, CEO Pat Gelsinger said the move was part of a cost structure realignment designed to change the firm’s operations, as it hadn’t been seeing enough revenue growth from technologies like AI.

Both AMD and Intel have been playing catch-up with industry rival Nvidia over the last two years. The chipmaker’s market value has surged due to soaring demand for its high-end chips, with big tech firms ramping up AI adoption and flocking to the firm.

Intel’s revenue had been falling before the August layoffs, and Gartner analyst Alan Priestly told ITPro the firm needs to focus on developing a clear product offering for AI in order to capitalize on the trend.

Intel has won a long-running legal battle against the EU after successfully overturning an antitrust fine imposed in 2009.

The European Commission had found the company abused its dominant position in the chip market and fined it €1.06 billion, marking a record at the time.

According to the European Commission, the company had been giving rebates, some disguised, to major computer manufacturers, including Dell, Hewlett-Packard, and Lenovo, on condition that they bought Intel’s x86 central processing units (CPUs). These were termed conditional rebates.

The company was also found to be paying manufacturers to stop or delay the launch of products based on rival chips such as those from Advanced Micro Devices (AMD). This was known as ‘naked restrictions’.

"Such rebates and payments effectively prevented customers, and ultimately consumers, from choosing alternative products," the Commission said at the time.

"By undermining competitors’ ability to compete on the merits of their products, Intel’s actions undermined competition and innovation."

Since then, the case has gone back and forth at a glacial pace. The fine was overturned in 2022 on the basis that the Commission's analysis hadn't been thorough enough to prove that Intel's behavior had harmed competition.

The Commission then cut the fine to €376.36 million on the basis that it had only proved the naked restrictions were damaging competition, and not the conditional rebates.

In the wake of this, the Commission appealed, asking to reinstate the full amount of the original fine; but with this decision from the EU Court of Justice the case is finally over.

"The Court of Justice upholds the annulment by the General Court of the Commission’s decision finding an abuse of a dominant position on the part of Intel and imposing a fine of €1.06 billion on Intel," the court said in a statement.

"In its judgment, the Court of Justice rejects all of the grounds of appeal raised by the Commission."

While Intel may have dominated the chip market back in 2009, that's very far from the case now. As recently as 2020, analysis from S&P Market Intelligence showed it was the world's second-largest semiconductor corporation by market capitalization, behind only Taiwan Semiconductor Manufacturing Company (TSMC). Now, though, it's number 14.

What's changed is not just the rise of TSMC, but also the huge demand for AI, which has seen Nvidia's sales boom. The chipmaker recently recorded revenues of $30 billion for the three months to 28 July.

This week, it was reported by Korean media outlet MK that Intel Foundry was in talks with Samsung over a collaboration aimed at toppling TSMC.

The reports suggest the two could partner on research and development, share production facilities and exchange process technologies, the report said.

Intel and AMD have announced they will partner up to create an ‘x86 ecosystem advisory group’ in a move some experts think will help the pair fight off competition from UK chipmaker Arm.

The x86 is a complex instruction set computer (CISC) architecture that powers most of the world’s CPU market - according to Statista, Intel’s x86 processors made up 71% of laptop CPUs in Q3 2024.

Arm, meanwhile, produces a rival CPU architecture with the aim of cutting in on x86’s action in the industry.

Ben Bajarin, CEO and principal analyst at Creative Strategies, told ITPro that while the x86 architecture still dominates the CPU market, this move could help to fight off challenges from the firm.

The new advisory board will bring together several big names in tech as founding members, including Broadcom, Dell, Google, Hewlett Packard Enterprise (HPE), HP, Lenovo, Meta, Microsoft, Oracle, and Red Hat.

Interoperability is the key focus here, and the group will look to expand the x86 ecosystem through enhanced compatibility across different platforms, simplified software development, and provisions for developers.

The group wants to create a more unified set of instructions and architectural interfaces to ensure predictability and consistency across x86 products. To do this, the pair will field technical input from x86 hardware and software communities.

For x86 users, the intended benefits are greater levels of customer choice, standardized product interfaces across Intel and AMD x86 offerings, and greater levels of integration with operating systems, frameworks, and applications.

“We are on the cusp of one of the most significant shifts in the x86 architecture and ecosystem in decades – with new levels of customization, compatibility and scalability needed to meet current and future customer needs,” Intel CEO Pat Gelsinger said.

Will x86 stay on top?

At present, x86 commands a 90% share of the data center CPU market and 90% of the client CPU market, according to Bajarin. The advisory group is fighting off Arm in those areas more than anything else, he added, highlighting the necessity of the move.

Arm is a sizable competitor though. The firm has over 90% share of the mobile applications CPU market, according to Statista, and a 65% share of the global Internet of Things (IoT) market.

Bajarin said while the launch of the new advisory group could enable member firms to better shape the future of x86, there are still lingering concerns with regard to intel and AMD.

“This is a welcomed effort, but I'm not sure if it means more consistent and compatible extensions or not, as I expect Intel and AMD to still maintain some degree of differentiation with their versions,” Bajarin said.

There are a lot of underlying architectural characteristics Bajarin expects this move to have an impact on, though, and the deal will likely bolster more consistent software and hardware experiences.

Bajarin questioned how the move would help the x86 fit into the new world of AI, which AMD seemed to suggest it would. The chip maker emphasized the importance of a robust x86 ecosystem, adding that it will be crucial in the current landscape characterized in part by AI workloads.

Seeing as the x86 architecture doesn’t play much of a role outside of host CPUs in data centers, and that most AI workloads run on GPUs or non-x86 AI accelerators, Bajarin remains unconvinced about how the move would fit into plans for AI.

Meta is reportedly laying off workers across several divisions as part of a continued cost-cutting drive.

First reported by The Verge, roles at WhatsApp, Instagram, and the Reality Labs units are among those in the firing line. The move from Meta appears to coincide with an ongoing reorganization scheme within specific teams.

Some workers have taken to social media in the wake of the move to confirm their roles have been cut. Jane Manchun Wong, who became known for revealing unannounced features coming to apps before joining the Threads team in 2023, is among those affected.

"I’m still trying to process this but I’m informed that my role at Meta has been impacted," she wrote on Threads. "Thank you to everyone, especially my Threads and Instagram teammates, for my wild journey at Meta."

"Today, a few teams at Meta are making changes to ensure resources are aligned with their long-term strategic goals and location strategy," a company spokesperson told ITPro.

"This includes moving some teams to different locations, and moving some employees to different roles. In situations like this when a role is eliminated, we work hard to find other opportunities for impacted employees."

This isn't the first time in recent years that Meta's made layoffs. In 2022, it shed 11,000 employees, around 13% of its total workforce, after being overoptimistic about its prospects following the Covid pandemic.

2023, which CEO Mark Zuckerberg famously described as the ‘year of efficiency’, saw the tech giant lay off another 10,000 workers and cancel 5,000 job vacancies in a bid to reduce headcount and cut costs.

The latest move marks the second batch of layoffs at the Reality Labs division in a matter of months. In the summer, Meta confirmed plans to restructure the hardware unit into two groups, resulting in a small number of job losses.

Meta cuts the latest in another troubling year for big tech

Meta isn’t alone in its cost-cutting efforts in recent years. A host of other major players in the global technology industry have followed suit, largely due to challenging macroeconomic conditions in the wake of the pandemic.

In August, for example, Cisco announced plans to cut thousands of roles - around 7% of its staff - on top of the 4,000 it cut earlier in the year.

At around the same time, Intel announced plans to cut its workforce by 15%, or 15,000 roles, blaming poor returns on AI and saving a reported $10 billion. Dell also cut 12,500 staff, or around 10% of its workforce, on top of a further 20,000 roles shed over the previous 15 months.

Other major tech firms making large rounds of layoffs since the beginning of the year include Microsoft, eBay and PayPal.

However, according to data from Layoffs.fyi, the number of job losses across the tech industry is lower than at the start of 2023, with a total of 263,000 jobs cut across the tech sector last year.

ITPro has approached Meta for comment.

AI PCs are set to make up the majority of all computers sold by 2027, according to new research, with adoption rates expected to surge in the coming years.

The PC market has largely stalled in recent years, with manufacturers experiencing a severe drought in consumer and enterprise demand, though that looks set to change.

Research earlier this year predicted a slight increase in sales thanks to a looming Windows refresh as Windows 10 hits end of support next year as well as the rise of AI PCs.

Now, research by AltIndex.com using data from Statista and Canalys shows that six-in-ten of all PCs sold by 2027 will be AI PCs. That's three-times more than are expected to be sold this year.

This uptick will be driven by manufacturers pushing AI PCs as their top-of-the-line products, the study noted, as well as their utility in industries relying on edge computing.

"Many consumers and businesses also turn to AI PCs for enhanced productivity and to handle tasks like machine learning, data analysis, and creative work more efficiently," a post from AltIndex.com added.

"The rise of generative AI applications has also fueled demand for these devices. With more and more users searching for an AI-enhanced PC, their annual shipments will skyrocket in the following years."

The data suggested AI PCs would make up a fifth of total PC sales this year, tripling to 60% by 2027 and topping 205 million by 2028.

What is an AI PC and why are they all the rage?

While there's debate, the simple definition of an AI PC is one that features dedicated hardware to run AI systems.

Microsoft defines it as a PC running a neural processing unit (NPU), which imitates the brain's neural network structure to run AI applications and tasks more efficiently, while leaving your CPU and GPU to handle the rest of your computing.

AltIndex points to Lenovo's Yoga Book 9i — released last year — as the first "AI-enhanced PC", but notes that AI accelerators and other hardware have since been integrated into the designs of many more PC manufacturers.

To be clear, most laptops will be perfectly fine running the current generation of AI, such as using AI-based software or tools, or solutions like Microsoft Copilot — you don't need anything special to access ChatGPT, for example.

Indeed, Microsoft doesn't specify any hardware requirements to run Copilot 365 at the moment, though there are licensing and software that must be in place first.

So why is Microsoft offering PCs designed for AI? To run more advanced Copilot+ PCs "experiences" — which includes controversial Windows Recall, for example — a computer needs 256GB storage, 16GB RAM, and a compatible processor or system on a chip.

So far, this only includes the Snapdragon X Plus or the Snapdragon X Elite. Other AI PC chips could include AMD's Ryzen AI 300 or Intel's Lunar Lake while Apple is working on its own in-house hardware, according to AlphaSense.

"The Copilot+ PC features are more than just apps," Microsoft says on its website. "They are advanced AI capabilities that require a Neural Processing Unit (NPU) with 40+ TOPS to work as intended. Without an NPU, these features, such as Paint Cocreator or all Windows Studio Effects, may not function properly or at all."

This all suggests that, going forward, such specs are what will become the minimum for running AI tools — and that means, assuming AI takes off, that ‘AI PCs’ will soon simply become PCs.

Businesses are facing a rapidly evolving technological landscape, with IT budgets either flat or seeing slight increases, but under more pressure than ever to deliver more value. Global IT spending is expected to grow by eight percent in 2024 according to Gartner, reaching a staggering $5.1 trillion this year driven by cloud computing, AI, and cybersecurity investments.

Yet despite this growth, many organizations are still struggling with outdated infrastructures that hinder their ability to innovate and remain competitive​. This is because of legacy ‘creep’ of systems accumulated over time, due to M&A, or simply because they don’t have the right level or volume of skilled personnel.

Security and compute performance are no longer optional but critical elements that can make or break a business. With cybersecurity spending expected to top the list of priorities for this year and next, companies are scrambling to integrate robust security solutions into their IT modernization strategies​.

Meanwhile, businesses that fail to invest in modern, scalable infrastructure run the risk of falling behind their more agile competitors. Modernization, powered by solutions like HPE ProLiant Servers and Intel Xeon Scalable processors, ensures not only the security and stability of today but the future-proofing necessary for tomorrow’s innovations.

Balancing business as usual with innovation

Businesses are under increasing pressure to keep daily operations running smoothly while staying ahead of the curve through innovation. According to IDC, global spending on digital transformation is projected to reach nearly $4 trillion by 2027, driven largely by investments in AI, cloud technologies, and cybersecurity.

However, many organizations face tight budgets and skills shortages that mean they struggle to balance maintaining operations with future-proofing their infrastructure.

"The rise of generative AI presents both challenges and opportunities for organizations,” says Mariya Yahnyuk, research analyst with IDC's Data & Analytics Group. “As digital investments become dominant, it is crucial for organizations to partner with vendors who can provide guidance on resource allocation and effective digital transformation strategies. To stay competitive and innovative, it is essential to harness its potential benefits and avoid missing out on opportunities due to uncertainty.”

One of the main issues facing decision-makers is the growing complexity of IT environments. As businesses increasingly adopt hybrid cloud models, managing these environments while ensuring security and scalability can be a big challenge that can risk stealing time and focus away from other important areas.

Gartner forecasts a 15% rise in cybersecurity spending by 2025, indicating that security risks – especially those related to AI and cloud integration – are becoming a major priority for organizations. But many businesses find it difficult to invest heavily in modernization while grappling with the day-to-day requirements of business as usual.

Another challenge is the threat of downtime. Even minor disruptions in IT infrastructure can have a domino effect, impacting customer satisfaction, employee productivity, and revenue generation. As businesses digitize more workloads, particularly to make the most of AI and data analytics, the risk of performance bottlenecks increases. In advance of modernization, leaders must ensure their systems can handle large-scale data processing efficiently, without slowing down or becoming vulnerable to cyberattacks.

In the face of these pressures, companies must embrace modernization not just as a strategy for innovation, but as a way to safeguard their current operations. With predictions showing continued growth in spending on security, AI, and digital transformation, organizations that fail to adapt are likely to face greater risks of downtime, inefficiencies, and lost opportunities in an increasingly competitive landscape.

All this ever-increasing complexity means businesses are craving simplicity in their decision-making and management of their infrastructure. But they need that infrastructure to still be sophisticated and innovative in powering their business and setting them up for success today and tomorrow.

HPE ProLiant Servers powered by Intel Xeon Scalable processors, deliver on these needs, providing security, performance, and stability to help meet the demands of doing business today as well as what tomorrow may bring.

Security and performance: the pillars of modern infrastructure

When it comes to maintaining business operations while embracing innovation, security and performance are foundational. As organizations move towards more complex IT environments, integrating AI, cloud, and hybrid models, they can lose track of their environment which raises the risk of cyber attacks.

A modern infrastructure that embeds security into every layer of its design – covering endpoint protection, data encryption, and access controls – helps organizations mitigate these risks. With advanced, real-time threat detection and response capabilities, businesses can safeguard sensitive information while maintaining operational resilience.

However, security isn't the only priority. In today's data-driven economy, performance is just as critical. Systems that can't process and analyze massive amounts of data efficiently risk falling behind. High performance is essential for everything from powering AI applications to managing hybrid workloads and ensuring that critical business applications run without interruptions. In an era where downtime or even lengthy processing delays can mean millions in lost revenue, organizations need infrastructure that can deliver reliable, high-speed performance without compromising on security.

Beyond just technical capabilities, there is enduring value in investing in a platform with long-term product roadmap and support. HPE and Intel customers can count on their servers to evolve alongside customer needs, ensuring they stay ahead of the competition and are prepared to handle whatever challenges or opportunities the future may hold.

Versatile infrastructure for today and tomorrow

Businesses today face the challenge of maintaining reliable, high-performing IT operations while also preparing for future innovation. HPE ProLiant Servers, powered by Intel Xeon Scalable processors, provide a well-rounded infrastructure solution to address these needs.

These servers offer a compelling combination of security, performance, and scalability. Designed with robust security features that protect data from edge to cloud, HPE ProLiant Servers have been built to withstand the latest threats without compromising on availability or computing power.

In terms of performance, the ProLiant line is optimized to handle a wide range of workloads. Whether running resource-intensive AI and analytics applications, processing massive datasets, or executing mission-critical business operations, these servers deliver the speed and reliability required to avoid costly downtime and maintain operational excellence. Their ability to scale resources up or down seamlessly enables organizations to adapt to changing needs without disruptive infrastructure overhauls.

The capacity for continuous innovation is essential for long-term growth and competitiveness. In striving for this via modernization, leaders would do well to pursue hardware such as HPE’s ProLiant Servers, paired with Intel Xeon processors, which provide a technology foundation built to support both current and future business requirements.

Organizations planning to leverage AI, cloud-native applications, edge computing, or other innovative solutions can rely on the ProLiant family to deliver the necessary processing power, scalability, and flexibility. By future-proofing their IT infrastructure in this way, businesses can adopt new capabilities seamlessly without requiring costly system replacements down the line.

Intel is navigating troubled waters after a disappointing earnings call, and analysts have told ITPro the firm needs to up its product game to turn it around. 

With a 1% year-on-year drop in revenue and plans to slash 15% of its workforce, Intel currently finds itself in a worrisome position. CEO Pat Gelsinger said the company's poor results were partly due a failure to fully capitalize on AI.  

The firm needs to “revisit its product side” to stay competitive, according to Gartner analyst Alan Priestley. “It's not there with a product that is being broadly accepted” in the communities developing AI.

Where other companies such as Nvidia have been able to more successfully capitalize on the generative AI boom, Intel has fallen somewhat by the wayside. 

“Nvidia got lucky in the right place at the right time with the right products … Intel was not there,” Priestley said. 

That being said, the vast majority of companies are “not there” in terms of AI deployment. While Intel has missed the initial “AI wave”, there is time for the company to ride the ongoing wave as it comes, provided it can get “its story right and its product right.” 

Chips and AI aren’t the only things on Intel’s mind, either, as the separation of the firm's product and foundry arms has brought into focus its semiconductor aspirations.

This side of the company, Intel Foundry, is “consuming a huge amount of capital” and demanding “massive investments on new infrastructure", Priestley said.

This means Intel is incurring large losses in the near term, though as Priestley notes, it takes time in the semiconductor industry – “it’s not instant gratification.”

The firm’s success going forward will depend on whether it’s able to capitalize on these growing and developing aspects of the business which are currently not delivering the most impressive returns. 

As Priestley is careful to point out, Intel will always be somewhat buoyed from the ongoing presence of other aspects of its business. For example, Intel accounts for over 70% of CPUs in the global PC market. 

“The world can't afford for Intel to fail, because there's nothing to take up the slack,” Priestley said. 

Intel and Nvidia are on different paths

When Gelsinger took the reins at Intel, it had already fallen behind Nvidia in the chipmaker space. Nvidia overtook it in 2020, knocking Intel down into third place behind TSMC in terms of value. 

While there was hope that Gelsinger would spur Intel back out ahead, Nvidia has maintained its lead, posting a staggering $26 billion profit in the first quarter of 2024. This represents an 18% year-on-year increase.

However, although both firms manufacture chips, it’s not a like-for-like. Or, as Priestley put it, an “apples-to-apples” comparison.  

“Intel designs and manufactures chips it sells to third parties that sell to end users. Nvidia designs and manufactures chips that it integrates into products that it sells to end users,” Priestley told ITPro. 

Nvidia is selling “systems, not chips” and can therefore cut out the “middle player”, which is part of the reason the firm is seeing such huge revenue increases. 

The company “doesn't need to sell a lot to ramp its volume up” owing to the pricing of its products. By comparison, Intel needs to sell “tens of millions of CPUs” to drive its revenue. 

Priestley noted he would even debate classifying Nvidia as a chip manufacturer in the traditional sense of the phrase. While it designs the chips it uses in its products, it doesn’t profit from them in the same way and operates a very different business model. 

Intel has announced a tidal wave of layoffs in a move set to cut the company’s workforce by 15%, or 15,000 roles, citing poor returns on AI in a memo sent to employees. 

CEO Pat Gelsinger said the move was part of a cost-cutting mission in response to sluggish revenue growth and the firm’s inability to unlock financial benefits from the generative AI trend.

“Simply put, we must align our cost structure with our new operating model and fundamentally change the way we operate. Our revenues have not grown as expected – and we’ve yet to fully benefit from powerful trends, like AI,” Gelsinger said.

He added that Intel’s costs are too high and its margins too low, with “bolder actions” needed to address this disconnect, particularly considering the firm's financial outlook after a worse-than-expected earnings call.

The firm plans to deliver cost savings of $10 billion in the next year and is planning on completing the round of layoffs by the beginning of 2025 to achieve this aim.

Gelsinger didn’t shirk on the specifics, explaining in the memo that the business had taken a “clean-sheet view” of its strategy following the implementation of a new operating model. This ultimately revealed that Intel’s cost structure is “not competitive.”

He cited the firm’s areas of focus moving forward, which include the reduction of operating costs, the simplification of Intel’s portfolio, the elimination of complexity between departmental overlaps, and the suspension of dividends.   

“This is painful news for me to share. I know it will be even more difficult for you to read,” Gelsinger added. “These decisions have challenged me to my core, and this is the hardest thing I’ve done in my career.”

The firm’s next steps include the announcement of a “companywide enhanced retirement offering” for those eligible and an “application program for voluntary departures.”

Intel's “disappointing” earnings outlook

Intel released its Q2 2024 results just prior to the circulation of the memo and it included some concerning figures. 

It reported $12.8 billion in profit, down 1% year-on-year and missing out on some analyst expectations. Gelsinger described the results as “disappointing” even as the company hit key milestones. 

This comes in contrast to rival firms such as Nvidia which has seen huge profits from AI over the last few quarters. The firm recorded a profit of $26 billion in Q1 2024, an 18% increase year-on-year. 

That being said, Scott Constable, Alliance Director at data center infrastructure specialists Vesper Technologies, told ITPro that Intel’s Q2 earnings are not as worrying as they seem. 

“Every cloud has its silver lining. Despite how Intel’s Q2 earnings may appear, industry observers are far more buoyant about its next few quarters,” he said, elaborating that there is a strong appetite for the firm’s products.

For more than 50 years, Intel has been a significant force in the semiconductor industry, shaping the course of modern computing. As one of the world's largest and most influential chipmakers, the company has been instrumental in the advancement of personal computers, the powering of data centers, and the creation of countless electronic devices that define the digital world.

Founded in 1968, Intel initially focused on memory chips before a pivotal shift in 1971 with the introduction of the Intel 4004, the first commercially available microprocessor. This innovation set the company on a new trajectory, leading to its dominance in the CPU market, which was solidified in the 1980s when IBM selected an Intel processor for its first personal computer.

Today, Intel's portfolio extends beyond microprocessors to include technologies for data centers, artificial intelligence (AI), 5G connectivity, and the Internet of Things (IoT). The company continues to invest in advanced chip manufacturing and new technologies like 3D packaging, playing a significant role in the development of a wide array of digital applications and devices.

Here, we explore the history, innovations, and far-reaching impact of this tech giant in shaping today’s digital world.

History of Intel

Intel was founded on July 18, 1968, by semiconductor pioneers Gordon Moore and Robert Noyce, both veterans of Fairchild Semiconductor. Initially incorporated under the name “NM Electronics” (after their surnames), the founders quickly decided on a more fitting title.

They chose “Intel,” a contraction of “Integrated Electronics,” and after acquiring the naming rights from the hotel chain Intelco, officially adopted the Intel Corporation name by the end of that month. Moore later served as executive vice president, became president and CEO in 1979, and stepped into the role of chairman before transitioning to chairman emeritus in 1997.

Intel initially established itself as a manufacturer of memory chips, producing significant SRAM and DRAM products during its early years. In 1971, the company launched the Intel 4004, recognized as the world’s first commercially available microprocessor, which marked a pivotal shift in Intel’s focus and laid the groundwork for its future leadership in the CPU market.

Intel’s prominence grew notably during the 1980s after IBM selected Intel’s 8088 processor for its first personal computer, a decision that helped establish the “IBM PC compatible” standard. This move positioned Intel as a primary supplier for the rapidly expanding PC industry.

Throughout the 1990s, Intel introduced the Pentium processor and launched the “Intel Inside” marketing initiative, increasing brand recognition among consumers and reinforcing its standing within the technology sector.

In the 2000s, Intel expanded its product portfolio beyond microprocessors, entering markets such as data centers, AI, and the Internet of Things (IoT). Acquisitions like Altera in 2015 and Mobileye in 2017 have further enhanced Intel’s capabilities in AI and autonomous driving technologies.

Today, Intel is active across a range of technology areas, including cloud computing, 5G, and advanced chip manufacturing. The company remains a major player in the semiconductor industry and continues to influence the development of technologies that support a wide variety of digital devices and applications.

What does Intel sell?

Processor technology continues to be a central area of development for Intel, with ongoing investment in innovations such as Foveros, a 3D packaging technology that enables the stacking of multiple chips to improve flexibility, power efficiency, and performance. Intel’s product range covers both consumer and enterprise markets, delivering a broad selection of high-performance components.

Intel’s microprocessors (CPUs), which power desktops, laptops, and servers across various industries, remain a key part of its portfolio. These CPUs are complemented by Intel’s chipsets, which manage data flow between the processor, memory, and peripherals to optimize system performance.

In graphics, Intel develops both integrated and discrete graphics processing units (GPUs). Integrated graphics are standard in many consumer computers, while discrete GPUs are aimed at more demanding applications, including gaming, AI, and professional visualization.

For storage solutions, Intel manufactures solid-state drives (SSDs) designed for high-speed, reliable data storage in both consumer and enterprise environments. These SSDs are widely used in data centers to support high-performance computing and cloud infrastructure.

In the area of networking and connectivity, Intel produces network interface controllers (NICs) for servers and data centers, as well as Wi-Fi and Bluetooth chipsets for consumer and Internet of Things (IoT) devices. These connectivity products are integral to wireless communication and support Intel’s presence in mobile and smart home technologies.

Intel also offers silicon photonics technology, which combines data processing with optical communication to enable high-speed data transfer over optical fibers. This technology is important for next-generation data centers and 5G deployments, particularly where compact and energy-efficient solutions are required.

Additionally, Intel provides system-on-a-chip (SoC) solutions that integrate multiple functions into a single chip for improved efficiency. These SoCs are used in a range of applications, from smartphones and embedded systems to industrial automation and smart appliances, delivering optimized performance and power management.

Intel maintains a presence in emerging technologies, including AI and machine learning, by developing both hardware and software solutions that accelerate AI workloads. The company’s field-programmable gate arrays (FPGAs), acquired through Altera, offer customizable processing for industries such as telecommunications, automotive, and healthcare, supporting adaptable solutions to meet diverse needs.

Intel mergers and acquisitions

Intel's strategic acquisitions have played a crucial role in expanding its technological capabilities and market presence. In 2015, Intel made a significant move by acquiring Altera for $16.7 billion. This acquisition allowed Intel to integrate field-programmable gate arrays (FPGAs) into its product lineup, enhancing its ability to offer customisable chip solutions that are critical for various applications in data centers and telecommunications.

Two years later, Intel further broadened its technological horizon by purchasing Mobileye for $15.3 billion. This acquisition was pivotal in advancing Intel's position in the autonomous vehicle sector, providing essential technologies for driver assistance systems and self-driving cars.

In 2019, Intel continued its push into emerging technologies by acquiring Habana Labs for $2 billion, significantly boosting its AI capabilities with advanced AI processors designed for deep learning applications.

In 2020, Intel acquired Moovit for $900 million, integrating mobility-as-a-service solutions into its portfolio. This acquisition not only expanded Intel's presence in the transportation sector but also underscored its commitment to smart city technologies and the future of urban mobility. These strategic acquisitions reflect Intel's ongoing efforts to diversify its technological offerings and maintain its leadership in the semiconductor industry.

Intel’s 2021 acquisition of SigOpt, a company focused on model optimization for machine learning, underscored its commitment to supporting AI and data science advancements. SigOpt’s technology aids in improving the performance of machine learning models, further bolstering Intel’s capabilities in AI research and development.

In 2022, Intel acquired Granulate, a developer of real-time performance optimization software, for $650 million. Granulate’s software helps improve the efficiency of cloud applications, addressing the needs of enterprise customers who rely on high-performance computing and want to reduce cloud costs.

Intel’s mergers and acquisitions strategy has remained active and dynamic in recent years, continuing to shape the company’s technological direction and market reach.

In 2024, Intel acquired InAccel, a company specializing in FPGA acceleration and high-performance computing, as well as Silicon Mobility, which focuses on automotive semiconductors and smart mobility solutions. These deals reflect Intel’s ongoing commitment to expanding its capabilities in AI, cloud computing, and next-generation automotive technologies.

Looking ahead, Intel’s approach to mergers and acquisitions is increasingly balanced with strategic divestitures. Notably, in March 2025, Intel completed the sale of its NAND flash memory division to SK Hynix for approximately $8.85 billion, a process that began in 2020 and marked a significant shift in Intel’s business focus.

This divestiture allows Intel to concentrate more resources on its core processor and advanced technology segments, while SK Hynix assumes responsibility for the NAND business. Despite these divestitures, Intel continues to pursue targeted acquisitions that reinforce its leadership in areas such as AI, edge computing, and semiconductor innovation, ensuring it remains at the forefront of the global technology industry.

Key figures at Intel

Intel’s leadership team plays a central role in shaping the company’s innovation and strategic direction.

Lip-Bu Tan is the current CEO, having taken over in March 2025. He is leading a major restructuring of Intel’s management and strategy, with a focus on engineering talent, customer satisfaction, and the success of the foundry business.

David Zinsner serves as executive vice President and CFO. Zinsner joined Intel in 2022 and brings extensive financial experience from previous roles at Micron Technology and Analog Devices.

Michelle Johnston Holthaus is executive vice president and CEO of Intel Foundry, a new position reflecting Intel’s increased focus on its foundry operations.

Sachin Katti is the chief technology and AI officer, overseeing technology and AI initiatives across the company.

Sandra Rivera is executive vice president and general manager of the data center and AI group. Rivera has been with Intel for over 20 years and continues to advance the company’s data-centric strategy, leading efforts in AI and networking solutions.

Greg Lavender is CTO and senior vice president of the software and advanced technology group. Lavender joined Intel in 2021 and leads software development, focusing on Intel’s software strategy in AI, cybersecurity, and cloud computing.

In June 2025, Intel announced the appointment of Srinivasan Iyengar, Jean-Didier Allegrucci, and Shailendra Desai to senior engineering and networking roles, supporting the company’s renewed focus on innovation and customer engineering.

CEO Lip-Bu Tan has restructured Intel’s leadership to create a flatter, more agile executive team, with several business units now reporting directly to him. This includes the appointment of Pushkar Ranade as Chief of Staff and the integration of new technical leaders into the executive team.

What can customers expect from doing business with Intel?

Intel’s leadership team, now headed by CEO Lip-Bu Tan as of March 2025, brings deep technology expertise and a renewed focus on innovation and customer partnership. For CIOs and IT directors, collaborating with Intel delivers strategic advantages that go well beyond hardware procurement.

Central to Intel’s value proposition is its ongoing investment in research and development. In recent years, Intel has maintained robust R&D spending — totaling over $17 billion annually — to accelerate advancements in computing, AI, and semiconductor manufacturing. This commitment to innovation ensures customers have access to the latest technologies and solutions.

Although the initial costs of Intel solutions may be higher compared to some alternatives, they often provide superior long-term value through enhanced performance, energy efficiency, and extended product life cycles. This translates to an optimized Total Cost of Ownership (TCO), making Intel products a prudent choice for organizations focused on sustainable growth.

Sustainability is another key area of focus for Intel. By 2023, Intel achieved 99% renewable electricity usage in its factories, furthering its commitment to responsible business practices and supporting corporate Environmental, Social, and Governance (ESG) objectives. These efforts align with the increasing importance C-suite leaders place on sustainability and ethical operations.

Intel also offers transparency in its product roadmap and maintains extensive ecosystem partnerships. For IT leaders, this means access to valuable resources that help align technology strategies with Intel’s upcoming innovations. Such foresight enables smoother transitions, better compatibility with existing systems, and reduced operational disruption.

Additionally, Intel continues to expand its portfolio in areas such as AI, cloud computing, and advanced chip manufacturing. The company’s broad range of solutions supports a wide variety of digital devices and applications, helping customers stay at the forefront of technological change.

Customers doing business with Intel can expect a partnership grounded in innovation, sustainability, and long-term value. With a clear product roadmap, strong ecosystem relationships, and a focus on responsible business practices, Intel remains a trusted technology partner for organizations worldwide.

Intel has launched two new initiatives aimed at getting developers and hardware makers on board with its plan to make AI PCs a success.

The new AI PC Developer Program and moves to add independent hardware vendors to Intel’s AI PC Acceleration Program are “critical milestones” in its plan to support the creation of 100 million Intel-based AI PCs by 2025, the company said.

Intel announced the launch of the program in October 2023 to offer hardware vendors and independent software vendors (ISVs) access to support, including AI toolchains, training, co-engineering, software optimization, hardware, design resources, and technical expertise to help kick-start the AI PC era.

The definition of an AI PC is somewhat fluid, but it’s generally accepted that they will feature dedicated AI accelerators, such as Neural Processing Units (NPUs), plus new features for productivity, personalization, and better power efficiency.

Intel and Microsoft, for example, have a definition of an AI PC as one that comes with a new NPU plus the latest GPU and CPU - plus Copilot and a Copilot key.

Intel scheme looks to drive developer interest

With its new AI PC Developer Program, Intel aims to extend its reach beyond the large ISVs and engage with small and medium-sized players and even ‘aspiring developers’.

The scheme provides access to tools, workflows, AI-deployment frameworks, and developer kits that include the latest Intel hardware featuring the Intel Core Ultra processor.

Intel also wants hardware makers to join its AI PC Acceleration Program, giving them the chance to prepare their hardware for the coming wave of AI PCs.

They will gain access to Intel’s Open Labs, which offers technical and co-engineering support early in the development phase of their hardware solutions and platforms.

Through this program, Intel provides reference hardware so that qualified independent hardware makers can test and optimize their technology so that it runs as efficiently as possible at time of launch.

With AI, much of the focus so far has been on the software running on PCs, but there could be plenty of opportunities to use AI to optimize a range of device features, from cameras and displays through to storage and memory, the company said.

If hardware or software developers can come up with new and compelling AI-powered features, that could help turn AI PCs into the hit that manufacturers are looking for.

Intel has already onboarded 150 hardware vendors around the world into its AI PC Accelerator Program, said Matt King, senior director of client hardware ecosystem at Intel.

Intel said with access to the latest Intel Core Ultra developer kits and optimization and software tools, developers can ensure their software and apps run smoothly on the latest Intel processors.

Similarly, optimizing software for specific hardware architectures early in the development cycle can lead to performance enhancements and efficiency.

Intel said it is bringing over 300 AI-accelerated features to market through 2024 with Intel Core Ultra processors across 230 designs from 12 global manufacturers.

AI PC shipments are expected to surge in 2024 and beyond

Interest in AI PCs among both manufacturers and enterprises alike has been surging in recent months. 

Tech analyst firm Canalys predicts that around 48 million AI-capable PCs will ship worldwide in 2024 – about 18% of total PC shipments.

But this is just the start of a major market transition, with AI-capable PC shipments projected to surpass 100 million in 2025, equivalent to 40% of all PC shipments.

Looking out further, within four years analysts reckon that vendors will ship 205 million AI-capable PCs.

Canalys said this emerging new category of PCs ought to lead to a moderate increase in the broader PC market because it will be weighted towards high-end PCs.

It expects a 10% to 15% price premium on AI-capable PCs compared with PCs without NPU integration. By the end of 2025, it said, over half of PCs priced at US$800 and above will be AI-capable, with this share increasing to over 80% by 2028.

Global shipments of AI PCs are set to surge across 2024 and account for nearly one-quarter of all PCs, according to new analysis from Gartner. 

Research from the consultancy shows that 54.5 million AI PCs will be shipped by the end of the year, accounting for 22% of all devices. Similarly, generative AI smartphones will also surge in popularity across 2024, Gartner said.

The increase in both AI PC and smartphone shipments marks a sharp rise on the year prior. Combined, 295 million AI PC and smartphone units will be distributed by the end of the year, up from just 29 million units in 2023.

Ranjit Atwal, senior director analyst at Gartner, said the heightened interest in AI PCs in recent months means these devices will “eventually become a standard requirement for technology vendors”.

However, Atwal said the scale of AI PC roll-outs by key industry vendors means many will face acute challenges in differentiating product lines.

“This ubiquity will pose challenges for vendors in differentiating themselves from competitors, making it harder to create unique selling points and drive increased revenues.”

Gartner’s research also found that the integration of AI into PCs is not expected to drive end-user spending beyond anticipated price increases, adding that business device purchasers will “demand compelling reasons to invest”.

“It will take time for software providers to harness the power of on-device AI and clearly demonstrate its enhanced benefits,” the consultancy said.

Crucially, the surge in AI-powered devices comes amid a period of tentative recovery for the global PC industry. The market, which experienced a significant downturn amid curtailed post-pandemic spending, returned to growth in the fourth quarter of 2023.

The rebound followed eight consecutive quarters of decline. Gartner said it expects overall PC shipments to reach 250.4 million units in 2024, marking a 3.5% increase from the year prior.

On-device AI will play a key role in helping to “rejuvenate the marketing of PCs through 2024 and help sustain existing anticipated replacement cycles”, the consultancy noted.

Will AI PCs be a flash in the pan industry fad?

AI PCs have rapidly become the latest industry buzzword, with a host of major device manufacturers, including HP, Dell, and Lenovo, all signaling their intention to ramp up production of AI-supported devices in the last quarter alone. 

In December 2023, Intel chief executive Pat Gelsinger suggested that AI PCs will be the “star of the show” in 2024 amid growing interest from both consumers and enterprises alike.

Gelsinger’s optimism on this front has been matched by other industry execs, with HP chief executive Enrique Lores insisting that the emergence of generative AI will create a "new kind" of PC.

But beyond the industry hype, analysts are also confident that AI PCs will become an increasingly important piece of kit in the enterprise arsenal moving forward.

Previous research from Canalys aligns closely with that of Gartner, with the consultancy suggesting that these devices could herald a “watershed moment” for the PC industry and “reinvigorate the market” after a record-breaking slump.

Canalys’ study predicted that 19% of all PCs shipped globally in 2024 will be AI capable, and moreover, it expects that 60% of all PCs will be AI capable by 2027.

Intel has announced the appointment of HPE executive Justin Hotard as executive vice president and general manager of its Data Center and AI Group.

Reporting to CEO Pat Gelsinger, Hotard will take the reins of Intel’s suite of data center products for the enterprise and cloud – which includes the firm’s Xeon processors, graphics processing units (GPUs), and accelerators.

A seasoned industry veteran, he brings more than 20 years’ experience in driving transformation and growth at computing and data center businesses, as well as specialism in delivering scalable enterprise AI systems.

In an announcement, Gelsinger said Hotard’s expertise will help Intel push forward with its data center ambitions, as well as its plans to “bring AI everywhere.”

“Justin is a proven leader with a customer-first mindset and has an impressive track record in driving growth and innovation in the data center and AI,” he said.

“Justin is committed to our vision to create world-changing technologies and passionate about the critical role Intel will play in empowering our customers for decades to come.”

Hotard joins Intel from HPE, where he most recently served as executive vice president and general manager of the company’s High-Performance Computing and AI business group, as well as Hewlett Packard Labs.

In that role, he was responsible for delivering AI capabilities to customers with data-intensive workloads while also directing the firm’s central applied research group.

Before beginning his spell at HPE in 2015, he previously served as president of NCR’s Small Business unit and held corporate development and operating positions at Symbol Technologies and Motorola.

At Intel, Hotard replaces Sandra Rivera, who left the position on January 1 to become chief executive officer of Intel’s Programmable Solutions Group, which it recently spun off as a standalone business.

“I am excited about my next chapter to lead the Data Center and AI Business Group at Intel Corporation,” Hotard said in a post on LinkedIn.

“I look forward to joining Pat Gelsinger and his talented team to contribute to its vision to create world-changing technologies and deliver on Intel’s mission to bring AI everywhere.”

After a long period of decline, the PC looks primed to return to growth, thanks to the arrival of new AI PC devices optimized for generative AI.

PCs have seen seven consecutive quarters of declining sales, with inflation and a more conservative approach to tech spending among enterprises prompting a marked dip in shipments.

But that could be about to change, according to analysts, with an improved economic environment leading to a surge in sales over the holiday period and beyond into 2024.

Across next year, shipments could hit 267 million units – marking an 8% increase compared to 2023, according to analysis from Canalys. 

While the need to replace aging Windows 10 devices will be a key factor behind this increase, the consultancy said a sharpened focus on the development of new AI PC models by manufacturers will play a pivotal role.

The global PC market is on a recovery path and set to return to 2019 shipment levels by next year, said Canalys analyst Ben Yeh.

"The impact of AI on the PC industry will be profound, with leading players across OEMs, processor manufacturers, and operating system providers focused on delivering new AI-capable models in 2024,” he said.

Canalys predicts that by 2027 over half (60%) of PCs will be ‘AI-capable’. It argues that the boom in generative AI will see PCs undergo a significant transformation in both hardware and software.

Hardware makers are also – unsurprisingly – upbeat about the potential here, with Intel CEO Pat Gelsinger saying earlier this month that the “AI PC will be the star of the show” in 2024.

So, what exactly is an AI PC?

Everything you need to know about the rise of the AI PC

Canalys principal mobility analyst Ishan Dutt said that the AI-capable PC category is still in a nascent stage, but the consultancy defines it as a desktop or notebook possessing a dedicated chipset or block to accelerate AI computing. 

Current examples include Qualcomm’s Hexagon Tenser Accelerator, Apple’s Neural Engine, Intel’s Movidius VPU and AMD’s XDNA, he said.

“This definition will evolve over time as these dedicated chipset features become increasingly commonplace in mainstream processors,” he told ITPro.

Dutt said there will be a move towards a nuanced grading scale that takes into consideration specifications about the neural processing unit – such as number of tera operations per second (TOPS) and other hardware requirements around memory and storage.

Apple has been leading the way with AI integration with its M1 Neural Engine way back in 2020, and since then Qualcomm has added to its ARM-based 8cx Gen3 chipset's AI capabilities, with a 2024 upgrade featuring the Nuvia architecture and Windows Copilot integration according to the analyst.

In the x86 world, AMD introduced its AI offering with the "Phoenix" Ryzen 7040, while Intel is marking its AI move by embedding the Movidius VPU in its Meteor Lake range. But beyond the processors, AI PCs will need additional memory, storage and GPUs, Canalys said.

“For instance, as optimized large language models (LLMs) become pre-installed on PCs, a combination of increased storage capacity with high-speed interfaces becomes essential. Similarly, running these LLMs will necessitate more memory and a robust GPU,” Canalys noted.

While adding generative AI capabilities to PCs could make everyone more efficient, the early adopters are likely to be workers who need to use LLMs to crunch data but are cautious about putting that data into a cloud service, or those that don’t want to deal with the latency that using cloud services can create.

Fellow tech analyst Gartner also expects the PC market to bounce back in 2024, as the business PC market is ready for the next replacement cycle, driven by the Windows 11 upgrades.

Meanwhile, it believes consumer PC demand should also begin to recover as devices purchased during the pandemic start to be replaced too.

Intel has announced a series of new processors with dedicated neural processing units (NPU) for artificial intelligence (AI) workloads in a bid to capitalize on the emerging AI PC trend. 

The firm’s Core Ultra mobile processors were unveiled at its ‘AI Everywhere’ event in New York City, and will be used in more than 230 new devices labeled AI PCs.

The Core Ultra processors will feature Intel’s latest NPU, AI Boost, which is optimized to deal with longer-running AI workloads at low power, boasting 2.5x better power efficiency over previous generations.

The company also announced its own AI chip, Gaudi3, built specifically for running AI models as it looks to compete with Nvidia’s H100 and AMD’s upcoming M1300x.

But the spotlight was placed firmly on the emerging AI PC trend, with Intel CEO Pat Gelsinger suggesting that this represents the future of computing. 

 “We’ve been seeing the excitement with generative AI, the star of the show for 2023 … [w]e think the AI PC will be the star of the show for the upcoming year” Gelsinger said at the launch event in New York. 

The list of partners using Intel’s Core Ultra processors includes, Dell, HP, Microsoft Surface, ASUS, and others, all of whom will try to capitalize on what they expect to be a bright future for AI PCs.

Intel’s executive vice president and general manager of Client Computing Group, Michelle Johnson Holthaus, said the company is confident AI PCs will be the next generation of computing, citing research from the Boston Consulting Group.

“The launch of Intel Core Ultra represents the unmatched scale and speed at which Intel is enabling AI on the PC. By 2028, AI PCs will comprise 80% of the PC market and together with our vast ecosystem of hardware and software partners, Intel is best positioned to deliver this next generation of computing.”

Rush to enter the AI PC market

With interest in AI PC’s continuing to gather pace, device vendors are rushing to show off their latest AI-enabled computers to capture early adopters.

HP geared up for a new generation of AI-ready devices at its Imagine conference in October. The device manufacturer unveiled its new HP Move all-in-one device at the annual event, revealing that it will be infused with AI capabilities.

Speaking to ITPro, HP’s president of personal systems, Alex Cho, said a period of high demand for a new suite of AI-ready devices is driving this shift across the industry.

“Nothing has gone from early promise to mass adoption quite like AI,” Cho said.

“Tomorrow, everyone will experience the full potential of AI, as the PC goes from the personal computer to the personal companion.

The incentive to catch this wave of mass adoption of AI technologies has also prompted similar product announcements from manufacturers.

Lenovo, for instance, recently announced new AI PCs, the ThinkPad X1 Carbon, X1 2-in-1, and IdeaPad Pro 5i featuring Intel Core Ultra processors to catch this “wave of AI-enabled business computing”.

The third compute engine introduced in Intel’s Core Ultra processors, the NPU, will allow for more flexible offloading of compute tasks, freeing up the GPU and CPU boosting the devices’ efficiency and performance.

As AI continues to excite business leaders and technology specialists alike, we can expect more announcements of this nature as manufacturer’s look to make strides in realizing their AI PC ambitions. 

IT management and support specialist GoTo has announced a new native integration for its LogMeIn Rescue solution with Intel’s Endpoint Management Assistant (EMA) for Intel vPro-based devices.

The move expands the pair’s existing partnership and makes GoTo the first to offer the integration, enabling customers to access EMA’s capabilities from directly within LogMeIn Rescue.

The aim is to provide IT teams with centralized and streamlined remote support, management, and reporting for vPro-based devices from within the solution, removing the need to switch between multiple different applications.

In an announcement, GoTo’s CTO Olga Lagunova said the company has been working closely with the chip making giant to develop the new Intel vPro API, following its initial integration of Rescue earlier this year.

“Today we’re taking the next step in our collaboration,” she said. “With Intel vPro natively paired with the enterprise remote support tool set of Rescue, which includes powerful remote control, system diagnostics, scripting, and more, we’ve made it fast and seamless to solve any problem from a single solution."

“Customers around the world already know and trust Rescue and Intel – and this is just the beginning. We’re excited to continue expanding our collaboration in the months and years ahead.”

Intel’s vPro offering is designed to allow IT teams to access and support remote, out-of-band services that do not run directly on the organization’s operating system.

Management of out-of-band devices has typically meant IT teams must navigate multiple solutions, workflows, as well as varying levels of end-user involvement.

The new integration means advanced actions can now be performed from a central console, making it easier to connect to the BIOS, troubleshoot OS and device driver corruption, or update the settings and firmware – even when devices are powered down.

Additionally, GoTo said all support actions will be automatically collated by the Rescue reporting system to provide a unified view of activities and outcomes.

“Intel’s collaboration with GoTo continues to deliver industry-leading manageability technologies to our joint customers to support an ever-expanding remote workforce and an array of endpoint devices,” commented Carla Rodriguez, VP and general manager of Client Software Ecosystem at Intel’s Client Computing Group.

“Using the newest Intel vPro Platform technology native integration with LogMeIn Rescue, IT teams will experience heightened productivity through a streamlined, single-pane-of-glass operation that includes robust out-of-band support capabilities, beyond the firewall, regardless of their physical location.”

Hewlett Packard Enterprise (HPE) and Dell Technologies have both announced UK supercomputer projects as part of a UK government initiative on artificial intelligence (AI) and exascale computing.

The UK government will invest £225 million in a joint project between HPE and the University of Bristol called Isambard-AI, which will become the most powerful supercomputer in the UK when it’s turned on in 2024.

Isambard-AI will be capable of 200 petaflops of performance under the Top500’s Linpack benchmark – around ten times that of the current fastest UK supercomputer, ARCHER2. It will also be capable of 21 exaflops of AI performance for training frontier generative AI models, such as new and advanced large language models (LLMs).

A further £75 million has been awarded to Dell Technologies, which has collaborated with Intel and the University of Cambridge to produce the Dawn supercomputer, which has been deployed and will be fully running in the next two months. The trio claim that it’s the UK’s fastest AI supercomputer at present.

Isambard-AI and Dawn combine to form a supercomputer cluster as part of the AI Research Resource (AIRR), a facility for AI research and innovation created through a £300 million government investment. 

Once the AIRR is fully operational, the UK will host some of the most powerful supercomputers not only in Europe but the world. Through this funding and the UK’s AI Safety Summit, the government has attempted to legitimize the UK’s place as an international research hub.

The Universities of Bristol and Cambridge will each host part of the cluster, with a phase 2 for Dawn expected in 2024 that will increase its performance tenfold.

"Today's announcement of the UK’s major investment in AI supercomputing underscores its commitment to taking a global leadership position in AI,” said Justin Hotard, executive vice president and general manager, HPC, AI and Labs at HPE. 

“The Isambard-AI system will harness world-leading supercomputing, including high-performance networking co-developed at HPE's Bristol labs, to provide the performance and scale required for compute-intensive AI projects. We are proud to partner with the UK Government and the University of Bristol to give UK researchers and industry access to Europe's largest AI system for open science."

Unlike HPE with Isambard-AI, Dell has not yet released expected performance numbers for Dawn, but will do so at the Supercomputing 23 conference, held from 12-17 November 2023 in Denver, Colorado.

The supercomputer has been formed from PowerEdge XE9640 servers, which contain Intel’s Xeon Scalable processors and Intel Data Center GPU Max accelerators. In Dawn, Intel has a chance to prove the power of its GPUs in comparison to Nvidia’s sought-after AI chips, in its goal to achieve AI hardware dominance by 2025.

“Collaborations like the one between the University of Cambridge, Dell Technologies and Intel, alongside strong inward investment, are vital if we want compute to unlock the high-growth AI potential of the U.K,” said Tariq Hussain, head of UK public sector at Dell Technologies. 

“It is paramount that the government invests in the right technologies and infrastructure to ensure the UK leads in AI and exascale-class simulation capability. It’s also important to embrace the full spectrum of the technology ecosystem, including GPU diversity, to ensure customers can tackle the growing demands of generative AI, industrial simulation modeling and ground-breaking scientific research.” 

Isambard-AI is being built using HPE’s Cray EX supercomputer, hosting 5,448 of Nvidia’s GH200 Grace Hopper Superchips connected using HPE Slingshot 11 interconnect technology. It will also be capable of almost 25 petabytes of storage using the Cray Clusterstor E1000.

HPE says that Isambard-AI will be optimized for AI data and will be housed in a self-cooled data center at the National Composites Center at Bristol and Bath Science Park. Excess heat will eventually be used to heat nearby buildings.

Once fully operational, the AIRR cluster will push the UK closer to its exascale goal and drive research in fields including climate modeling, AI, future energy systems such as fusion, and frontier science.

IBM has announced plans to take part in a $235 million series D funding round of the open source and open science artificial intelligence platform Hugging Face.

Other companies involved in the investment included Google, Amazon, Intel, and Salesforce. The funding round was led by Salesforce Ventures, according to Salesforce CEO Marc Benioff. Hugging Face CEO Clem Delangue said the round has taken Hugging Face’s value to $4.5 billion, more than double 2022’s valuation of $2 billion.

The investment and valuation is an indicator of the appetite for AI companies in the marketplace and the development of the technology by investors.

Delangue used the investment round to celebrate the crossing of 1,000,000 models, datasets, and apps on the platform.

Of the investors, he said: “These partners alone shared over 1,000 open models and datasets and have over 10,000 users on Hugging Face already. It takes a village to democratize good machine learning with open source and we’re just getting started!”

Delangue’s plan for the investment is growth. He said: “My priority for the next month? Hiring, hiring, hiring with a big focus on diversity!”

Hugging Face is an interesting organization in the AI space. Where some companies take care to protect their AI models and charge for access, the Hugging Face model is more about collaboration, with datasets and applications shared among the community.

That said, Hugging Face has chargeable options. Its Enterprise Hub, for example, starts at $20 per user per month and provides SSO and SAM support as well as storage location options - a significant feature for customers facing regulatory oversight.

Charging extra for access to more compute power and customer support represents an important revenue stream for the company, even if its revenues are far below its current valuation.

Its Hub, however, remains “forever” free and includes unlimited models, datasets, and spaces.

The news follows IBM - in collaboration with NASA - open sourcing a large geospatial AI foundation model available on Hugging Face. IBM and Hugging Face also announced plans in May to collaborate on watsonx.ai, an enterprise studio aimed at AI builders to train, validate, and tune both traditional machine learning models and newer generative AI capabilities powered by foundation models.

Hugging Face has also collaborated with other tech giants. For example, in May 2023, it announced plans to bring open source models from the Hugging Face Hub to Aure Machine Learning. Earlier in August, a partnership with NVIDIA was announced to give developers access to NVIDIA DGX Cloud AI supercomputing within the Hugging Face platform.

The $5.4 billion merger of Intel and Tower Semiconductor has been called off after Chinese regulatory approval was not secured. 

The termination will cost Intel $353 million in fees - payable to Tower - and comes as Intel Foundry Services (IFS) has begun gaining customer traction, according to the chipmaker.

The deal was originally announced in February 2022 and formed part of Intel’s $20 billion Integrated Device Manufacturing (IDM) 2.0 vision. However, a lengthy wait for regulatory approval from China has resulted in the deal being called off. 

Regulatory approval had already been gained in the US and Europe. 

China and the US are currently at loggerheads over semiconductors, and US lawmakers have brought into force strict restrictions over the export of technology to China.  

Gaurav Gupta, VP analyst at Gartner, told ITPro that the issues around approval were likely a consequence of the US’ restrictions. 

Back in February 2022, when the deal was first announced, Gupta said that the hope was that trade friction between the superpowers would ease somewhat. However, the opposite has turned out to be the case, and this deal has become a high-profile casualty. 

Gupta also warned of a chilling effect across the industry as companies considered their options where approval in China was required.  

“This will make companies think before they pursue any other M&A,” he said. 

“Because they know you don't want to invest 18 to 24 months in a deal and then find out it's not coming through.” 

Tower Semiconductor, an Israeli company, thanked all parties for their efforts to secure an agreement.  

Russell Ellwanger, CEO at Tower Semiconductor, said: “Tower was very excited to join Intel to enable Pat Gelsinger’s vision for Intel’s foundry business”. 

The parties had 18 months in which to complete the deal, and as 15 August 2023 passed with no indication of imminent approval, the companies agreed to terminate the agreement. 

Pat Gelsinger, CEO of Intel, paid tribute to Tower Semiconductor before insisting that the company is on-track to “regain transistor performance and power performance leadership by 2025”. 

While that 2025 goal is unlikely to be substantially affected by the termination of this deal, Intel may be disappointed that 18 months of negotiations have borne little fruit. 

Intel has been focused on leading edge nodes, and the Tower acquisition would have given it access to mature nodes and the customer experience to support them. Mature process nodes produce huge amounts of simple chips that require little in the way of updates and stay in use for decades.  

To offer customers a complete service, IFS must support more than just leading edge nodes. 

In its most recent earnings figures for Q2 2023, Intel reported a 15% decrease in year-on-year revenue, although it still exceeded the higher end of guidance, according to the company.  

While Gelsinger praised the year-on-year growth of the IFS business unit, which amounted to more than 300%, its $232 million performance was still far behind the company’s other units. Mobileye, for example, reported $454 million in revenue for the same period. 

Despite the termination of the merger agreement, Intel has been investing in IDM 2.0.  

It expects to invest up to $4.6 billion in a new semiconductor assembly and test facility in Wroclaw, Poland, and has also signed a letter of intent with the German Federal Government for the company’s wafer fabrication site in Mageburg, Germany. 

After its discontinuation in July, ASUS has announced plans to take the Intel NUC product line forward.

While the move will be welcomed by fans of the mini-PC, analysts are considering the motivations behind the agreement and the business case driving it.

Ranjit Atwal, research director at Gartner, told ITPro that ASUS could have an existing contract in place and needed the NUC to fulfil its needs. 

“There’s got to be some business benefit from this,” he said.

“I can only imagine that they’ve sold [some] already and they need to fulfill them for something very specific”.

Intel and ASUS have agreed a term sheet to take the NUC forward to manufacture, sell, and support the 10th to 13th Gen NUC product line and develop future designs.

Sam Gao, Intel’s vice president and general manager of Intel Client Platform Solutions, noted that the company was pivoting its strategy “to enable ecosystem partners to continue NUC systems product innovation and growth”.

The result is a deal for ASUS to take over the NUC line. Gao went on: “I am looking forward to ASUS continuing to deliver exceptional products and supporting our NUC systems customers”.

ASUS’s chief operating officer, Joe Hsieh, thanked Intel and said the plan was to expand ASUS’s presence in areas such as AI and AIoT.

The NUC mini-PC is too powerful for IoT solutions that tend to use microcontrollers or low-power chipsets - for example, the Raspberry Pi - and Atwal said that ASUS was likely considering something between edge hardware and a fully-fledged compute device.

What is the Intel NUC?

The NUC - or Next Unit of Computing - was launched just over ten years ago by Intel and has evolved over the years alongside Intel’s CPUs. 

The small form-factor PC tends to be around 10cm x 10cm, although the dimensions have changed slightly over different generations.

The NUC could be purchased as a barebones kit or as a complete PC - Intel tried several configurations over the years, from something suitable to be dropped into an office environment to powerful options that could form the basis of gaming rigs.

Ultimately, the device carved itself a niche among users seeking the tiniest PC possible. It also faced stiff competition from alternatives such as the Apple Mac Mini as well as an ongoing trend toward mobile computing.

It clearly wasn’t a huge success for Intel. Atwal said: “The fact they’re winding it up tells you everything”.

Intel and Dell are to take part in the building of a “digital twin” of the UK’s Spherical Tokamak for Energy Production (STEP) prototype fusion power plant.

The UK Atomic Energy Authority (UKAEA) is collaborating with the tech giants and the Cambridge Open Zettascale Lab to produce a simulation of the plant, in an effort to meet the ambitious goal of delivering fusion energy to the UK’s energy network in the 2040s.

The UKAEA plans to make use of the lab’s supercomputer - based on Intel technologies - with 4th generation Intel Xeon processors running on Dell PowerEdge Servers.

The engineering behind such a fusion power plant requires enormous amounts of modelling and simulation, with a single plasma turbulence simulation potentially outputting hundreds of petabytes of data for analysis.

Thousands of graphics processing unit (GPU) nodes are required for large simulations with the open source Intel Distributed Asynchronous Object Storage (DAOS) object store taking care of the storage needed by high performance computing (HPC) applications.

Intel’s Data Center GPU Max Series chips are being looked at by the UKAEA as part of providing the large step increase in power required to drive the simulations.

During a briefing on Tuesday, Dr Paul Calleja, director of Computing Research at the University of Cambridge, remarked that traditional x86 systems “are not going to get us there” and that GPU technology would provide an order of magnitude increase in performance per watt.

“That’s really what this is about,” he said.

Calleja also called out Intel’s oneAPI, with a nod to SYCL, as “a really interesting programming environment”. The open nature of the standard means that the team has the option to use alternative silicon in the future.

“We can also run those codes on NVIDIA GPUs, and even AMD GPUs with minimal recode,” he explained, “And obviously, some of the coding is required, but it's not extreme.”

As for an operating system, Scientific OpenStack will be used in an effort to make the supercomputers accessible to a broad range of scientists and engineers.

Why do we need all this computing power?

In a word: Time. While it may seem a long away, the 2040s represent a very ambitious timescale considering the historic rate of progress of Fusion energy. As such, there simply isn’t enough time to adopt a fully test-based design process to work out what the power plant should look like.

Head of Advanced Computing at UKAEA, Dr Rob Akers, remarked that “Fusion has long been referred to as an exascale Grand Challenge”.

“We need to exploit the world's largest supercomputers to handle all of this physics and all of this complexity,” he added, “It's an absolutely staggering number of calculations.”

“We'll be able to get to the point where a digital version of STEP starts to emerge before the real plant itself,” he said. ”In the short term, we'll be able to use that digital version … to dramatically reduce the need for real world validation.

“So we'll be able to be a lot more intelligent around which components that we do have to prototype and test. And we'll be able to be a lot more intelligent about where we have to introduce design margin, or design overhead in order to make sure that the power plant has the efficacy to deliver power to the grid.”

In the longer term, there is the potential to turn the design into a full digital twin of the power plant for operational planning and anomaly detection.

What is STEP?

The Spherical Tokamak for Energy Production is a UKAEA programme to demonstrate the ability to generate electricity from fusion. A concept design is expected by 2024 and construction of the plant is expected to be complete “around” 2040.

According to the UKAEA “Fusion power creates nearly four million times more energy for every kilogram of fuel than burning coal, oil, or gas".

Akers described the project as “effectively a moonshot programme”, the goal of which was to prove fusion can be economically viable. It is, however, not expected to be a commercially operating plant at this stage.

Other fusion projects underway globally include ITER, which is expected to become operational at the end of 2025 with the goal of demonstrating a large fusion reactor rather than generating electricity.

Intel’s aggressive expansion in Europe highlights the company’s appetite to cast off the shackles of its lamented market slide in recent years, according to analysts. 

In recent weeks, the chipmaker has announced a series of ambitious investments in Europe, including a $32.8 billion pledge to build a new chip manufacturing site in Germany, marking the largest foreign investment in the country to date. 

The firm also pledged $4.6 billion to build a new chip plant in Poland alongside a $25 billion investment in Israel, once again making this the largest-ever investment in the state. 

Gartner VP analyst Alan Priestley said the rapid flurry of investment pledges comes at a difficult time for the chipmaker. 

Intel recorded a 36% year-over-year decline in revenue in the first quarter of 2023.

This earnings call underlined the difficulties the company was experiencing on the back of sluggish growth in the global PC market.

“Intel has had a slump because the market has dropped. It’s heavily linked to the PC market and consumer spend has declined, so that has impacted its business - it’s also got intense competition.”

This growing competitive landscape and declining consumer spend means that the company has been fighting strong headwinds in recent quarters. However, the investment pledges show that the firm appears bullish on keeping pace and continuing to expand its global footprint. 

“From Intel’s perspective, if it doesn’t do it, the competition will,” Priestley said. “That’s TSMC, and all the big chip vendors run on TSMC - Intel has to keep in line with those vendors.”

Priestley noted that if Intel “stops and stands still”, it is at heightened risk of losing its position in the market amid progress being made by competitors. 

Investing in new manufacturing capacity is a necessity, therefore, and will enable the firm to retain its market position.

Growing demand for processors means new fabs are critical

Intel’s expansion in Europe and Israel comes amid a period of rapid acceleration in the broader semiconductor industry, with increasing demand for higher-performance chips driving intense competition across the board. 

While Priestley noted that this is a natural evolution of the industry, the heightened competition in recent years means Intel must invest to keep pace and retain its market share. 

“The semiconductor industry has had a long history of successive generations of process tech, this is what has driven the semiconductor industry for 40, 50 years,” he said. 

“As the process tech evolves, new demand requires higher performance chips.”

Long-term, establishing these new facilities, known as ‘fabs’, will enable Intel to continue innovating and keep pace with the demands placed by continuously-advancing processor technology.  

A key traditional challenge for the semiconductor industry has been that, as new technologies emerge, existing fabs often cannot be updated to accommodate the new manufacturing requirements or capacity demand. 

This bears similarities to practices in the car manufacturing industry, for example, in which organizations would shut down a production line each year to refresh equipment to produce a new model of vehicle.

“They wouldn’t manufacture for six weeks or so while the new model was being put into the line,” Priestley said. “The semiconductor industry is a bit like that - except you don’t shut the fabs down because there’s a continuous demand for product.”

“So once you build a fab, you run it for four or five years, maybe longer, manufacturing products on that process. To bring a new process up, the existing fab none of the tools inside will support it, or they need upgrading. You need a bigger fab, therefore you put it at a new site.”

Intel has laid out a roadmap for establishing product leadership in the processor market by 2025, alongside a goal of democratising AI under a consolidated range of AI-optimised hardware and software.

Core to its proposition is a diverse range of products including central processing units (CPUs), graphics processing units (GPUs), and dedicated AI architecture alongside open-source software improvements.

Businesses can expect to benefit from fourth-generation ‘Sapphire Rapids’ Xeon CPUs immediately, with the fifth-generation Xeon codenamed ‘Emerald Rapids’ set for a Q4 2023 release. This will be followed in 2024 by two processors known as Granite Rapids and Sierra Forest.

Sapphire Rapids can deliver up to ten times greater performance than previous generations. Internal test results also showed that a 48-core, fourth-generation Xeon delivered four times better performance than a 48-core AMD EPYC for a range of AI imaging and language benchmarks.

With Granite Rapids and Sierra Forest, Intel will address current limitations for AI and high-performance computing workloads such as memory bandwidth, with 1.5TB memory bandwidth capacity, and 83% peak bandwidth increases over current generations.

Seperately, Intel is also focusing development of GPU and FPGAs (field programmable gate arrays) to meet the demands for large language model training, largely through its Intel Max and Gaudi chips.

It stated that Gaudi 2 has demonstrated two times higher deep learning inference and training performance than the most popular GPUs.

Training on this level is key for large language models (LLM), and demand has risen since the meteoric rise in generative AI models such as ChatGPT.

Around 15 FPGA products will be brought out this calendar year, which will add to Intel’s compute product range, including for deep learning, artificial intelligence, and other high-performance computing needs.

Over time, Intel intends to draw together its GPU and Gaudi AI accelerator portfolios to allow developers to run software to run across architectures.

A plan for an open AI ecosystem

In addition to its achievements and plans for hardware, the firm said it aims to capture and democratise the AI market through software development and collaboration.

With 6.2 million active developers in its community, and 64% of AI developers using Intel tools, its ecosystem already has strong foundations for further AI development.

Intel cited its recent work with Hugging Face, enabling the 176 billion-parameter LLM BLOOMZ through its Gaudi2 architecture. This is a refined version of BLOOM, a text model that can process 46 languages and 13 programming languages, and is also available in a lightweight 7-billion-parameter model.

“For the 176-billion-parameter checkpoint, Gaudi2 is 1.2 times faster than A100 80GB,” wrote Régis Pierrard, machine learning engineer at Hugging Face.

“Smaller checkpoints present interesting results too. Gaudi2 is 3x faster than A100 for BLOOMZ-7B! It is also interesting to note that it manages to benefit from model parallelism whereas A100 is faster on a single device.

Hugging Face noted that the first-generation Gaudi accelerator also offers a better price proposition than A100, with a Gaudi AWS instance costing $13 per hour in comparison to Nvidia’s $30 per hour.

Intel did not provide benchmarks for Gaudi performance next to an H100, the successor to the A100 which is part of the reason big tech is choosing Nvidia for AI.

But lining up Nvidia’s GPUs - long considered best in market - against its own shows Intel is confident that it can deliver and exceed shareholder expectations when it comes to market dominance by 2025.

As part of its Hugging Face collaboration, fourth generation Xeon was used to improve the speed of the open source image generation model Stable Diffusion by more than three times as part of its work with Hugging Face.

The company affirmed its commitment to keep contributing upstream software optimisations to frameworks like TensorFlow and PyTorch, as one of the top three contributors to the latter.

To further open the AI ecosystem, Intel is adding more features to oneAPI, its cross-architecture programming model that offers an alternative to Nvidia’s CUDA software layer.

One of these improves access to SYCL, an open source, royalty-free programming model based in C++ that is heavily used to access hardware accelerators.

Intel’s SYCLomatic can be used to migrate CUDA source code automatically, freeing programmers from time constraints that could otherwise lock them into Nvidia’s architecture.

“We believe that the industry will benefit from an open, standardised programming language that everyone can contribute to, collaborate on, and which is not locked into a particular vendor so it can evolve organically based on its community and public requirements,” said Greg Lavender, CTO and GM of the software and advanced technology group at Intel.

“The desire for an open, multi-vendor, multi-architectural alternative to CUDA is not diminishing. Fundamentally, we believe that innovation will flourish the most in an open field, rather than in the shadows of a walled garden.”

Intel has announced a wave of pay cuts and reduced benefits in the wake of poor quarterly earnings, affecting mid-level, vice presidential, and executive staff.

The firm is reportedly set to cut mid-level staff wages by 5% in March, with higher-level roles such as VPs and executives facing 10% and 15% salary cuts respectively. Pat Gelsinger, CEO at Intel, could also cut his salary by up to 25%.

Staff will also face greatly-reduced benefits in the immediate future, with quarterly bonuses and merit-based raises cancelled and the company’s 401(k) matched payment scheme reduced from 5% to 2.5%.

“This was an incredibly dumb move, as employees will become “quiet quitters” and lose morale,” wrote semiconductor analyst Dylan Patel, who stated that all Intel employees in grades 7 to 11 will see cuts.

“Bonus cuts are one thing, but base pay cuts sting. Intel, unfortunately, has to cut costs dramatically due to its immense amount of cash being burned, but they are doing it in the worst way.”

“High performers likely start to 'phone it in' while they look for their next job, as there is no incentive to keep working long nights and early mornings. The level 7 cut-off point is too low. This includes some fresh advanced graduates and many normal graduates with a handful of years of experience.”

The changes have been implemented following a challenging quarter - the chip giant announced its Q4 revenue of $14 billion on 26 January, down 32% year-on-year, with its client computing group business unit reporting a 36% year-on-year decline.

The decline follows the ‘biggest ever decline’ in worldwide PC shipments, which has impacted hardware.

“Despite the economic and market headwinds, we continued to make good progress on our strategic transformation in Q4, including advancing our product roadmap and improving our operational structure and processes to drive efficiencies while delivering at the low end of our guided range,” said Gelsinger on the earnings call.

Other firms have been affected by the downturn in hardware sales, with Microsoft having reported a 39% drop in device revenue across the same period.

Reuters reported that Gelsinger had described Intel as having “stumbled” in its recent performance.

The firm has ceded market share to main rival Advanced Micro Devices (AMD) which reported better-than-expected earnings in its Q4 call.

Shareholders are not expected to receive reduced payouts, and annual bonuses will continue to be paid. However, as annual bonuses are linked to the company’s financial standing these are expected to be reduced as compared to previous years’ bonuses.

"As we continue to navigate macro-economic headwinds and work to reduce costs across the company, we’ve made several adjustments to our 2023 employee compensation and rewards programmes," Intel told IT Pro.

"These changes are designed to impact our executive population more significantly and will help support the investments and overall workforce needed to accelerate our transformation and achieve our long-term strategy. We are grateful to our employees for their commitment to Intel and patience during this time as we know these changes are not easy."

Intel’s move to cut salaries at this stage rather than engage in mass layoffs has put it out of step with the strategies of other large tech firms.

2023 has already seen a number of large firms slash staff, as Amazon and Salesforce fired a combined 26,000 employees and Google cut its global workforce by 12,000 roles.

A number of factors are behind this wave of big tech layoffs, including unsustainable business models and a drive for greater profit at the expense of employee security. As recession bites, more firms are expected to engage in cuts of this kind.

This article was updated to include comment from Intel.

Chip giant Intel has claimed its new 4th Gen Xeon processor range is both a historic moment for the company and also its most sustainable data centre processors ever released.

The launch included the 4th Gen "Sapphire Rapids" Xeon Scalable processors, the Xeon CPU Max Series (codenamed "Sapphire Rapids HBM"), and the "Ponte Vecchio" Data Center Max Series GPU.

For data centres, the CPU is designed so that it optimises power and performance in ways that help customers achieve their sustainability goals.

They focus on platform-level power savings; the 4th Gen Xeon has more built-in accelerators, a type of hardware specifically designed to improve performance on the chip itself. It takes away any need for additional discrete acceleration devices or software which could ramp up energy consumption and price.

Intel's new range also comes with an Optimised Power Mode which the company claims can deliver up to 20% socket power savings with just a 5% impact on performance.

There are also new air and liquid cooling technologies, but one of the most notable innovations relates to the way the 4th Gen Xeon has been built at Intel's manufacturing sites with "state-of-the-art water reclamation facilities" that use 90% or more renewable electricity.

The launch of the 4th Gen Xeon Scalable and the Max Series is a "pivotal moment" in the resurgence of Intel, according to Sandra Rivera, the company's executive vice president and general manager of Data Centre and AI.

Intel has struggled over the last few years with underwhelming market performance and production delays, which have also been exacerbated by the pandemic and global supply chain bottlenecks.

"Intel's 4th Gen Xeon and the Max Series product family deliver what customers truly want - leadership performance and reliability within a secure environment for their real-world requirements - driving faster time to value and powering their pace of innovation," Rivera said.

Combined with the Data Center GPU Max Series, the CPU Max Series can achieve up to 12.8 times greater performance compared to previous generations when running the LAMMPS molecular dynamics simulator, according to Intel.

Latest chips in action

Lenovo has collaborated with Intel on the new chips and has released 25 new ThinkSystem and ThinkAgile server and hyperconverged cluster products, all powered by Intel's 4th Gen Intel Xeon Scalable processors.

The new products sit in the company's Infrastructure Solutions v3 portfolio and aim to deliver "advanced performance, efficiency and management capabilities specifically optimised for complex workloads," the company said in an announcement.

Lenovo said its latest products are able to achieve double the workload performance compared to the previous iterations.

"In today’s competitive business climate, modern infrastructure solutions that generate faster insights and more efficiently enable complex workloads from the edge to the cloud are critical across every major industry," said Kamran Amini, VP and GM of server and storage at Lenovo Infrastructure Solutions Group.

"With the performance and management improvements of the Intel-based ThinkSystem V3 portfolio, customers can reduce their IT footprint by up to three times to achieve greater ROI and more easily transform their infrastructure with one seamless platform designed for today’s AI, virtualisation, multi-cloud and sustainable computing demands."

Intel has unveiled its Intel Max Series product family, which the company hopes will help researchers and businesses solve problems faster.

The new family is made up of the Intel Xeon CPU Max series and Intel Data Center GPU Max series, which it says have been designed for high performance computing (HPC) and artificial intelligence (AI) workloads. These platforms were previously known internally under their code-names Sapphire Rapids HBM and Ponte Vecchio, respectively.

The Xeon Max CPU is the first and only x86-based processor with high bandwidth memory, helping to accelerate HPC workloads without needing code changes, Intel has claimed. The new CPU contains up to 56 performance cores with 64GB of high bandwidth, as well as PCI Express 5.0.

The component can provide over 1GB of high bandwidth memory (HMB) capacity per core, which Intel said is enough to fit more common HPC workloads. It provides up to 4.8x better performance compared to competition on real-world HPC workloads, the company claims.

The CPU also uses 68% less power than an AMD Milan-X cluster for the same performance. Intel also added that its climate modelling capabilities are 2.4x faster than the AMD Milan-X and it provided a 2.8x better performance against competing products in its double data rate (DDR) memory.

Additionally, the Max Series GPU, designed for data centre use, is the chip company’s highest density processor, containing over 100 billion transistors in a 47-tile package with up to 128 gigabytes (GB) of memory. It delivers up to 128 Xe-HPC cores, the new foundational architecture targeted at the most demanding computing workloads. It features 408 megabyte (MB) of L2 cache memory, the highest in the industry, and 64MB of L1 cache, to increase throughput and performance. Intel added that it’s the only HPC/AI GPU to come with native ray tracing acceleration, which speeds up scientific visualisation and animation.

Intel underlined that the Max series has been designed for the HPC community with scalable and balanced CPUs and GPUs. Researchers and businesses will be able to solve problems faster and more sustainably through these components, with the company highlighting how it will be a benefit for HPC projects like mitigating climate change impacts or curing diseases.

“To ensure no HPC workload is left behind, we need a solution that maximises bandwidth, maximises compute, maximises developer productivity and ultimately maximises impact,” said Jeff McVeigh, corporate vice president and general manager of the Super Compute Group at Intel. “The Intel Max Series product family brings high bandwidth memory to the broader market, along with oneAPI, making it easy to share code between CPUs and GPUs and solve the world’s biggest challenges faster.”

The GPU component will be available in different forms depending on customer needs. It will come in a Max Series 1100 GPU, in a 300-watt double-wide PCIe card with 56 Xe cores and 48GB of HBM2e memory. It will also come as the Max Series 1350 GPU is a 450-watt module with 112 Xe cores and 96GB of HBM. Lastly, it will be available as the Max Series 1550 GPU, Intel’s maximum performance 600-watt module with 128 Xe cores and 128GB of HBM.

The new series is expected to launch in January 2023, and the company is set to ship the new GPUs to the Argonne National Laboratory to power the Aurora supercomputer.

Intel highlighted that Aurora, which is still under construction, is expected to be the first supercomputer to exceed two exaflops of peak double-precision compute performance. It will be used to showcase the Max Series GPUs and CPUs in a single system, with over 10,000 blades, each harbouring six Max Series GPUs and two Xeon Max CPUs.

The CPUs will also be used at other HPC systems, including Crossroads at Los Alamos National Laboratory, CTS-2 systems at Lawrence Livermore National Laboratory and Sandia National Laboratory, and Camphor3 at Kyoto University.

Experts have assured that the confirmed leak of Intel's Alder Lake source code will 'most likely' not lead to any meaningful adverse impact on the security of its products, despite others branding the leak as a "scary" prospect.

According to experts who spoke to IT Pro, attackers would need access to other components to have a substantial chance of developing harmful exploits and also be able to bypass the existing protections that Intel has in place.

"It is unlikely that viewing software code alone will cause a subsequent cyber security incident," said John Goodacre, director at the UKRI’s Digital Security by Design challenge and professor of Computer Architectures at Manchester University. "Much of the UEFI source code is already open source and available for third-party use and inspection.

"Proprietary initialisation and configuration code can make it easier to understand potential attack vectors, but with appropriate hardware protection such as a root of trust, trusted execution environments and other security by design features in the implementation would mean it is no less secure unless production keys are also exposed."

Others echoed Goodacre's position that the industry nor Intel customers should be alarmed. Martin Jartelius, chief security officer at Outpost24, said the way in which the data had come to be leaked is substantially more interesting than the contents of the leak itself.

“There is no need to be alarmed by this data leak in and of itself, if you are a user of this technology," he said. "There is, however, more concern that either someone working in relation to hardware either had their repository or system breached, or are themselves careless with the information they process on behalf of others. Where this leak happened and why, to me, is substantially more of interest for us as a community than the code.”

At time of writing, no verifiable source for the files has come forward and therefore few conclusions on operational security can be drawn from the leak but it's certain that Intel will be investigating the incident closely.

The news sparked an initial scare that the leak could lead to the discovery of novel exploits impacting Intel's processors built using its Alder Lake architecture, launched in November 2021.

In theory, attackers with access to a company's source code are able to more easily find novel vulnerabilities in the impacted product by reverse engineering the way in which the code functions.

Sam Linford, VP EMEA channels at Deep Instinct, agreed and added that “the theft of source code is an extremely scary prospect for organisations". Other companies such as Rockstar Games and LastPass have both been victims of source code theft this year.

The Alder Lake leak

Rumours started circulating on Friday of a potential leak of Intel's Alder Lake source code after a series of links were posted on Twitter via anonymous messaging board 4Chan. The links led to a download of files totalling 5.86GB in size.

The Twitter link led to GitHub a repository titled ‘ICE_TEA_BIOS’ and was last edited on 30 September. This contained a compressed version of the files, but has now been taken down.

"Our proprietary UEFI code appears to have been leaked by a third party,” said an Intel spokesperson to IT Pro, confirming the leak to be genuine.

“We do not believe this exposes any new security vulnerabilities as we do not rely on obfuscation of information as a security measure. This code is covered under our bug bounty programme within the Project Circuit Breaker campaign, and we encourage any researchers who may identify potential vulnerabilities to bring them our attention through this programme.

"We are reaching out to both customers and the security research community to keep them informed of this situation."

Due to the size of the file repository, security researchers are taking time to determine what critical information might have been exposed by the leak.

Concerns were immediately raised over the extent to which hackers might be able to utilise Intel’s Alder Lake BIOS source code and it's still unclear whether the files were the subject of a data breach, or whether an insider leak from within Intel or a connected firm was the source.

Welcome to IT Pro's News in Review, a weekly bite-sized bulletin of the top tech stories of the week, for the week ending 26 August, 2022.

This week's stories:

• Fujitsu becomes Japan's first domestic company to commercialise quantum computing
• IT teams need to optimise and tackle tech debt ahead of economic downturn, warn analysts
• Intel strikes $30 billion private equity partnership to fund Arizona plant expansion

You can find more videos like this in our video library and even more on our YouTube channel. Let us know what you think of this week's video – you can also find us on Facebook, LinkedIn and Twitter.

This automatically-generated transcript is taken from the IT Pro Podcast episode ‘Solving the semiconductor shortage’. We apologise for any errors.

Adam Shepherd

Hi, I'm Adam Shepherd.

Rory Bathgate

And I'm Rory Bathgate,

Adam

and you're listening to the IT Pro Podcast. This week, we're heading down to the chip shop to talk about semiconductor supply chains and the recent global chip shortage. Our modern way of life has become completely dependent on technology. But this presents a bit of an Achilles heel. Semiconductors and silicon chips are the fundamental foundation on which all current systems are based. So what happens when those chips disappear?

Rory

Since late 2020, the tech industry has been struggling with acute difficulties in the semiconductor supply chain, affecting the availability of microchips, circuitry and other components. This has had a knock on effect on a huge range of products, including everything from laptops to Land Rovers, as availability plummets, and prices skyrocket.

Adam

So what's behind the supply chain challenges? And how close are we to resolving them? Here to talk us through the current situation as well as how the industry can strengthen supply chains in the future, is Ondrej Burkacky, Senior Partner at McKinsey’s Semiconductor Practice. Ondrej, thanks for joining us!

Ondrej Burkacky

Thanks for having me.

Adam

So let's talk about the chip shortage. One of the most obvious contributing factors was the impact of COVID on global supply chains. But do you think that was the primary cause, or were there other contributing factors?

Ondrej

I think that indeed it was, it had a very large contribution to what we are experiencing now. But it was for sure, not the only cause that we had, we also had some geopolitical tensions, mainly between US and China, that led to some restriction in global trading. That also led to several players putting semiconductors on stock, even before the shortage happened. And that combined with some individual occurrences, for example, the famous winter storm in Texas that happened in 2021. And also the fire in in one of the Japanese factories, were not really the I would say deal makers or breakers, but a near combination contributed to the situation that we are in now.

Rory

And outside of OEMs, what impact would you say the chip shortage has had on businesses?

Ondrej

Look, I think that, on the one hand, for sure, it is a shortage on the OEM side, right. But also when you look at the bit down and upstream there, the predictability of chip delivery has significantly suffered, right? Meaning also the tier one and tier twos are in a very unpleasant situation that on the one hand, they have a clear demand coming from the OEMs. But on the other hand, they are, they don't have a clear commitment from the semi compliance on suppliers, there is not enough supply existing here. And with that the whole supply chain starts to be very shaky, and less predictable. And also this invites to order typically called bullwhip effects, right, people starting to over order because there is a shortage, we'll just order more to get when there is an allocation, a sufficient amount; with that the demand for that explodes and so on and so forth.

Adam

So what level of shortfall are we talking about here? What's the discrepancy between supply and demand? Are we talking kind of orders of magnitude?

Ondrej

Yeah, it's a very good question. I think that that the answer to it is It depends really on the semiconductor type, right? And I think the one mistake that people typically do is like they say it's all the same, which is not true right. For example, we have almost no shortage on what is called leading edge technology, right, the CPUs and server chips. We also have less shortage on memory devices, being it storage, being it around for for compute, but we have a significant -meaning 30-plus percent - shortage of generic compute MCUs, right, that are there, for example, to be do the power management, that are there to operate the motor control in a dishwasher, in the washing machine, but also they are the ones that go into many, many cars to do motor control, airbag control, and all these all these things. So these are the ones where I would say the shortage is the most, and as I said, we are talking 30 perhaps 40% shortage versus what is the demand that is out there in the market.

Adam

So you mentioned laptops and server chips. We know that Intel in particular has been struggling with this, this issue, they've faced some strong headwinds as a result of various kind of supply chain issues; if CPUs themselves aren't being as affected as other types of of processors and kind of compute elements, what are the main challenges that companies like Intel are having to grapple with?

Ondrej

Yeah, look, I think that for for the whole PC or server, as you mentioned, right, it just doesn't only take one chip, right? There is memory in there, there is power management ICs there, right? And a bit ironic way, right? What caused the biggest headache for the server and PC OEMs were not the highest value semiconductors, typically, right, there was some shortage on the GPU side, but it was really this power management ICs, some of the power conversion ICs, some of the connectivity ICs. And it is like when you don't have this piece, you just can't ship the whole unit. So at some point in time, when you are the supplier of a CPU or or sent or other components that are not short, you also get affected by the shortage because people don't want to put more of on stock right of your equipment. Because they basically say, Well, I can't build the system anyway. So why should I have so much inventory on you? And with that, it's kind of there is the line definer, which is the component that is the most short, defines how much can get delivered, how much can get shipped.

Rory

So, what role would you say just in time manufacturing models have played into the current shortage?

Ondrej

Okay, I think that they did play a significant role. And you can see when you compare between different verticals, right, for example, when you take the consumer electronics industry, they typically do not have just in time delivery, because they have a high seasonality, right, I mean, there is a singles day, there is there is Christmas, Black Friday, Chinese New Year, where you have peaks in sales, and therefore you need to take precautions, and you need to put more parts on stock. If you take that other bookend here, which is the automotive industry, which has kind of optimised for just in time delivery. That is brilliant, as long as you have enough supply because then you don't need to have, have a lot of inventory. But this is one of the reasons why the automotive industry got struck so hard by the chips shortage is because they had basically no inventory along the entire value chain that they could survive from. And you can even see it when you compare between the different automotive OEMs. So if you look, for example, the Japanese players, they did a hard running from the from the Fukushima accident to put much more inventory in general on stock, right? So they basically being a bit, one of the inventors of just in time delivery, they actually did go away from it a bit. And so they were a bit hit less hard by the chip shortage than others, at least at the beginning; at some point, also that that inventory is used up, right?

Adam

So how well is the semiconductor supply chain recovering, at present? You're on site at a semiconductor fabrication facility at the moment; what is the current state of play in the kind of wider supply chain?

Ondrej

Yeah, I think it's it is a very interesting time here because of the demand jumped. Also, the plans of many semiconductor players to extend the manufacturing sites, right, have have been pulled in or extended. On the other hand, there is the physics here in place, right. So it still takes you minimum three years to ramp up a new semiconductor facility. And that's already a pretty short timeframe. Right. In many geographies, it's more five years that it basically takes you to get all the approvals to construct it, to bring in the tools to basically ramp up to a full yeilded product and with that, the players have focused very much on so called full vol expansions, which is basically expanding the existing sites, but that is almost already now exhausted, right. So, I think that there is like, if you if you find still a whitespace in an existing semiconductor fab, you are very lucky right? So the utilisation level there is already very high, right. So you are now looking into building new sites. And this is going to take time. And also there is one more consideration to put here out and that is that when you have such timeframes, like three to five years to build out a product production facility, you need to be damn sure that then not now you have to demand in place. Right. And this is why many people are now asking for customer commitments in a more mid or longer term range because nobody wants to end up having put five or 10 million in capex right to just find out that you know, three five years from now, the demand has softened and you cannot utilise that asset. And with that you're basically starting to lose money.

Adam

Yeah, absolutely. So how acute then are the shortages still? Are there still OEMs and manufacturers who are really struggling to meet their needs? And if so, how long will it be before semiconductor fabrication kind of supply chains are able to meet those needs effectively?

Ondrej

So then if I just take a very non scientific KPI and look into my calendar, how many meetings I have on chip shortage with how many players, I would say we are still in the middle of it, right. And I think this is indeed the case, right? Also if you look at the lead times, right, for the for the things that are really short. So our prediction says that 22 is going to be the same as 21, almost, right, only in 2023, we see also the first sites that basically start going piece by piece online that were basically built on top of what has been seen as the beginning of a shortage situation, which in the end means that by then we might get more chips that can be immediately used, it doesn't mean necessarily that only in 2023, all these disruptions in the supply chain are gonna go away, because it will take some time that restocking happens, it will some time that basically also the mix effect goes into the right price. We talked about this before that you need all the components to build a system in a way. So this can take well into 24 or even 25 until this gets fully sorted out. But there is ways for players right to optimise their sourcing, there is ways for them to commit to more longer term supply agreements. So where I would classify it to... So up till now, this being a very general problem for many players, right. And I think going forward, while there still might be a certain shortage, there will be ways for players to excel here and be able to source the semiconductors they need versus others might still struggle.

Rory

We're seeing governments become involved in the semiconductor shortage, America has just passed the landmark CHIPS for America Act that's providing around $54 billion in subsidies and the EU have their own Chips Act making headway. What kind of role do you see these these kinds of subsidies playing in the recovery of the semiconductor production? And do you think that governments have a real essential role in recovering for this industry?

Ondrej

Okay, I think that, generally speaking, the subsidies help in for companies to take the decision on making a CapEx investment, right, because very simply speaking, the return on investment, with a typical subsidy level, you get these days, reduces itself perhaps from nine years to even six, five years, right, depending on the on the level of subsidies you get. And with that, basically, your your, let's say, barrier to kind of overcome this investment decision and take the risk of perhaps not being utilised or you know, hitting a different market. And with that, it's reduced. So for that it is indeed, very helpful. Just one word of caution there for sure is, just because you have a Chips Act in place doesn't mean that the day after there is no more shortage, right? As I said before, there is still the physics of three to five years to build a semiconductor plant. Now also, with I think the very good intention that is out there, for some of the regulations it still only needs to become a bit more concrete, right, for individual players to be now sure that they will get a certain subsidies level. So they can bake it into their business case, and they can actually start executing.

Adam

So are there any ways in which the industry itself can look to increase the resiliency of the global semiconductor supply chain to try and prevent incidents like this from occurring in the future?

Ondrej

I think that this is really on the one hand, and important topic, on the on the other hand, a very tough one, right? Because the industry itself has always been optimised to be a global industry. Right? This is mainly due to the very high R&D investments that are required, right, the very high CapeX investment that you need, for example, on the manufacturing side, and the large scale effects you have right when you build things at scale, right. And with that, like when you look at the different, there are many segments right within the semiconductor industry. It's typically only a few players that act within these segments and they are always global, right? So they always produce for a global market. Now, one way is you can say okay, well, we can start to have more suppliers, right, we can start to become more resilient on that side, that will, by the way mean that the market shares of the players some way will be reduced here and there which might allow them to invest less in R&D, and so on and so forth. Right. So there is this challenge on that end. If you want to become more diversified and also more resilient, when it comes to certain regionalization, one really needs to be aware that this is a very long journey to go. Right. And there are also the subsidies that we talk about these days will not be by far enough, right, because we are talking typically about front end manufacturing, but this is just one piece, right? It does not include the wafers, does not include the speciality chemicals and everything, right. That's not including the back end manufacturing, so all these various steps in the value chain. So therefore, I think that something like full regional resilience is not anything that you can actually achieve and anyway, perhaps don't want to achieve, because it will just cause enormous amount of time and money. But really being more, having more transparency, where actually your main critical points are and being able to address some of them, I think is the strategy to go forward. And many companies are really exploring in the value chain, where these neurotic points actually are and whether they can do something about it.

Adam

Yeah. Cause the fact that, you know, a fire at one kind of Japanese manufacturing plant can have a notable impact on the entire global supply chain - that does seem like a pretty significant sort of single point of failure, in effect. And it does seem like greater diversification of the kind of manufacturing base within the semiconductor industry could potentially help to kind of mitigate the risk of that.

Ondrej

Yeah, I think Adam if I, if I may disagree with you on one thing, I think the headlines and the media presence of that fire were much larger than the impact it had.

Adam

Okay, interesting.

Ondrej

So, I think that again, right, it was one small contributor, if at all, due to shortage situation we have experienced, right. And and the simple proof for that is like that, the impact of that particular fire was kind of mitigated three, four months after it happened. And we still are in a shortage situation. Right. So I think this is this is indeed something which is not completely new to the industry. But indeed, what is newer to the industry is the overall high utilisation we are facing, right. So this is kind of the the fundamental problem. And then, as always, right, then any drop, right, that happens here, and there just has has a much larger contribution because we are just operating on the edge.

Adam

Yeah.

Rory

So Ondrej, you've brought up this minimum of three years to set up a new sort of chain of, a new factory, a new facility. But what does the outlook for the supply chain look like over the next, say, 12 months or so?

Ondrej

Okay, I think that, that, in the end, there is some more capacity now coming online, right? I said, over proportionally to the to the previous years. But still, I would expect that the shortage is going to be a big topic for the upcoming 12 months. As now, there is a lot of discussion on long term commitments, long term supply agreement, but this is nothing that basically helps you now for the next, let's say 12 months, right? This is more securing your volumes in 2024, 2025, right? Because you have to see as well, what are the production cycles here, right? So a typical wafer that travels through the frontend fabs takes perhaps 100 days, right, to get produced, then you have the back end operations take another two three weeks; add it to the mix, right? So in a way, the chips that we will receive in six months, perhaps five months from now are the ones that are produced now. Right. So with that you only have this very gradual change, and therefore we don't expect the shortage to end shortly.

Rory

So we had news last month, that SMIC have claimed that they've broken through with the seven nanometer chip. What kind of differences does competition on this level make to the overall supply chain? And how has it changed the outlook for their competitors?

Ondrej

I think that it's it's always good to have additional capacity right? And and I think also competition is healthy in a way that it basically drives companies to do more innovation, to become more productive. Particularly on the on the leading edge note, as I said, this was not necessarily the the biggest area of shortage, right? It's more about providing OEMs or fabless companies alternatives from where they basically can source their leading edge chipsets, right, rather than being super significant contribution to today's shortage. However, going forward, for sure, with a certain node migration, meaning shrinking of the chip structures always to the more leading edge nodes or certain types of, of chips, for sure, it's good to have capacity, more capacity on the leading edge node size. But just to be very clear here, right? And we are not talking about all chips becoming seven, five or three nanometer, right? If you take the example of a car, 80% of the chips that are in a car are actually 50 nanometer plus.

Rory

That's quite a stark difference.

Adam

Yeah, that seems large.

Ondrej

Indeed, it is. And I think therefore, we also do forget sometimes that when we look also on these chips programmes that are out there, right, we should not forget about mature technology and feature nodes. Because in the end there again to coming back to my my initial example, right, you might have too high sophisticated chip in your phone, in your smart device. But if it can't power up because the perceivably less sophisticated power management chip is not there, then you are out of power.

Adam

Yeah, I think there's a tendency to kind of, particularly in the tech and IT industries, to focus on the really kind of cutting edge stuff, on the smallest process technologies and the, as you said, the kind of bleeding edge manufacturing challenges, but a lot of the industry is not that.

Ondrej

Yeah, very right Adam, and a lot of the industry's, by the way, never gonna be it as well, right. If you look at for example, all the discrete semiconductors, so the ones that do power management, right, so AC/DC conversion, DC/DC conversion, right. All the nice things that we need for example, for electric cars right? There the differentiation comes less from a shrink of the node size, it comes more from the processing technology, switching from from silicon for example, to gallium nitride, silicon carbide is there the innovation driver right. So, one should not forget that there is not only one vector, right, you need to follow through for innovation in semiconductors and with the world becoming more broadly using a broader set of semiconductor technologies, right, with industry 4.0, all the IoT devices, etc. All of a sudden, all of these technologies get a boost in growth of demand and with that, they will also need a certain growth in supply to match that.

Adam

Unfortunately, that's all we've got time for in this week's episode, so we'll have to close out there but our thanks to McKinsey's Ondrej Burkacky for joining us today.

Ondrej

Thank you.

Rory

You can find links to all of the topics we've spoken about today in the show notes and even more on our website at itpro.co.uk

Adam

You can also follow us on social media as well as subscribe to our daily newsletter.

Rory

Don't forget to subscribe to the IT Pro Podcast wherever you find podcasts. And if you're enjoying the show, leave us a rating and a review.

Adam

We'll be back next week with more insight from the world of IT but until then, goodbye.

The tech industry has been forced to weather more than its fair share of storms over the past few years, but one of the most troublesome to navigate has been the ongoing issues in the semiconductor supply chain. The situation has resulted in delays, shortages and missed revenue targets for companies across a range of industries, and has prompted government intervention across the globe.

There are a number of factors behind the disruptions to the chip supply chain, and although measures are being taken to mitigate their impact, the crunch is set to continue. We’re joined on this week’s podcast by Ondrej Burkacky, Senior Partner at McKinsey’s semiconductor practice, to explain some of the reasons behind the crisis, as well as what’s being done to resolve the situation.

Highlights

“I think the one mistake that people typically do is they say it's all the same, which is not true. For example, we have almost no shortage on leading edge technology; the CPUs and server chips… but we have a significant - meaning 30-plus percent - shortage of generic compute MCUs, that are there, for example, to do the power management, that are there to operate the motor control in a dishwasher, in the washing machine, but also they are the ones that go into many, many cars to do motor control, airbag control, and all these all these things.”

“Our prediction says that 2022 is going to be the same as 2021, almost; only in 2023 we see the first sites that start going online piece by piece, that were basically built on top of the beginning of a shortage situation, which in the end means that by then we might get more chips that can be immediately used. It doesn't mean necessarily that only in 2023, all these disruptions in the supply chain are gonna go away, because it will take some time that restocking happens… So this can take well into 2024 or even 2025 until this gets fully sorted out.”

“What caused the biggest headache for the server and PC OEMs were not the highest value semiconductors, typically; there was some shortage on the GPU side, but it was really this power management ICs, some of the power conversion ICs, some of the connectivity ICs. And it is like when you don't have this piece, you just can't ship the whole unit.”

Read the full transcript here.

Footnotes

• US and EU thrash out plans to avert chip production “subsidy race”
• US companies have less than a five-day supply of semiconductors
• Incoming disaster or overblown: How will the semiconductor chip shortage affect enterprise IT?
• US and Japan double down on joint semiconductor research
• Western Digital and Kioxia to get £562 million funding in Japan
• Intel to acquire Tower Semiconductor for $5.4 billion
• China to establish chipmaking platform to secure domestic chip supply chain
• Chipmakers should brace for 'oversupply' in 2023 with crisis set to clear
• Texas winter storm halts semiconductor production
• Short circuit: Will the chip shortage end this year?
• Intel to invest €33 billion in EU chip manufacturing
• Europe proposes €43 billion Chips Act to tackle semiconductor shortage
• Intel pauses Ohio chip site development, citing delays in US CHIPS act subsidies
• Why India wants to become a chipmaking powerhouse
• Intel strikes $30 billion private equity partnership to fund Arizona plant expansion
• Intel warns customers to expect price hike for certain chips
• Can the UK semiconductor industry help solve the global chip shortage?

Subscribe

• Subscribe to The IT Pro Podcast on Apple Podcasts
• Subscribe to The IT Pro Podcast on Google Podcasts
• Subscribe to The IT Pro Podcast on Spotify
• Subscribe to the IT Pro newsletter
• Subscribe to IT Pro 20/20

The growth of hybrid working during the global pandemic has underlined the importance of being able to rely on your business hardware fleet. While employees might tolerate having a less-than-current system on their office desk, having out-of-date equipment for home working simply added frustration to an already difficult situation. Now that the hybrid pattern is becoming the norm for many organizations, it’s imperative that companies equip their employees properly. Refreshing the corporate fleet might appear daunting, but it will be essential for the new normal of work. Here are some tips to help smooth the process.

Before considering the steps to take, it's also worth underlining that, now employees have tasted the benefits of a flexible working model, making this available and as seamless as possible is becoming an essential employee incentive. An Ernst & Young survey of over 16,000 employees across 16 countries showed that 54% would consider leaving their job if not offered some form of flexible working pattern. This shows that providing the necessary technological investment to enable this mode is fundamental for employee retention and attracting new recruits.

There is extensive evidence now that flexible working doesn’t impact productivity or can even improve it, and employees know that, so companies that don’t facilitate it risk losing the best employees to companies that do. Your PCs need to serve the needs of your workers and business as a whole, delivering security, performance, manageability and stability to support productivity and the work of IT teams while protecting your network from breaches.

Kickstarting your refresh

The first step is to make sure you have a clear idea of the current PC fleet and its capabilities. Your organization should already have a solid asset-tagging system in place, and this will be a core piece of information during the refresh. Allied with this is getting a clear idea of employee needs, which could be radically different for hybrid work. Up until the pandemic, most employees will probably have been bound to an office desk, so their desktop system may have sat largely dormant for most of the last two years, thanks to the numerous lockdowns. This system won’t be so valuable for a hybrid model. Unless this desktop system was shipped out for use at home, or a laptop culture was already in place, employees may have been using their personal equipment for work, leading to numerous problems of compatibility and security. Refreshing the PC fleet for hybrid working alleviates these problems.

Alongside auditing the current fleet, you should get planning for the refresh as soon as possible. Once you have an idea what employees want, and what they need for their everyday tasks, the search for the most appropriate systems to fulfill requirements can begin. Needs will vary, because a system that is good for general office software, internet usage and cloud-based applications might not be up to scratch for demanding tasks such as graphics or media work. Some employees will need greater portability than others, and some might benefit from ‘transformer’ devices with tablet and presentation modes alongside conventional laptop abilities.

Equipping employees for remote work can be greatly facilitated if a device-as-service (DaaS) provision is available. This can be combined with a consistent set of hardware specifications that can be supplied from a known brand to streamline deployment. A standard corporate configuration can be delivered remotely to off-the-shelf employee systems without the need to bring devices to the company’s IT department for preparation. Not only is this quicker, but with a global device vendor this can make it possible to equip employees in a more diverse range of locations. Linked to the ability to centrally manage the deployment of remote systems is control over data. If the device is lost or an employee leaves the company, having the option to remove sensitive information without direct physical access ensures corporate data integrity is maintained.

Once a range of devices has been defined, it’s worth budgeting to keep a selection of reserve equipment available to hot swap in the case of accidental damage or when an employee has left their device at home.

The right platform

All these stages in a successful refresh are greatly facilitated by having a hardware platform that can be depended on to deliver secure manageability for a wide range of different system specifications. Intel vPro® provides robust security and management tools that allow for remote diagnosis, repair and protection of user devices. This dependable remote access makes the hybrid working model easier to deploy and maintain.

Intel vPro® also delivers the performance and range of device types to satisfy the full scope of employee work scenarios. Whether a worker requires a multi-format device for complete flexibility, or uncompromising performance, Intel vPro® provides the security, performance, manageability and stability they need. A comprehensive range of internationally renowned PC brands have created innovative, cutting-edge Intel vPro®-based laptops, ensuring employees can be furnished with a device that perfectly fits their work requirements.

Providing a versatile, secure and reliable device is central to delivering the hybrid working environment employees now demand, and employers are starting to realize they must equip their employees with the hardware they want and need. A recent IDC report revealed that 72% of IT decision makers recognized that device choice is very important in their ability to recruit and retain talent. Similarly, 64% of workers said that the device they are given affected their productivity, with 62% saying this impacted their satisfaction levels. The IDC report also found that a further 56% claimed that the technology provided would affect their willingness to stay with a company over an extended period.

Refreshing your company’s PC fleet for the brave new world of hybrid work doesn’t need to be daunting, but it is a necessity. If you follow the steps we have defined here and choose dependable devices like those based on Intel vPro you can be sure to give your employees the systems they need to work efficiently. This will deliver the best incentive to retain staff and ensure your company thrives as hybrid working becomes the employment norm.

Intel technologies may require enabled hardware, software or service activation. No product or component can be absolutely secure. Your costs and results may vary.

@Intel Corp. Intel, the Intel logo, Intel vPro® and other Intel marks are trademarks of Intel Corporation or its subsidiaries. Other names and brands may be claimed as the property of others.

Chip giant Intel has announced a partnership with Brookfield Infrastructure Partners, which will see the pair jointly invest $30 billion into expanding the firm’s Arizona plant.

Expected to close by the end of the year, the deal is a first-of-its-kind Semiconductor Co-Investment Program (SCIP) and represents a new funding model in the capital-intensive semiconductor industry, Intel said.

Under the terms of the agreement Brookfield will fund 49% of the $30 billion cost of expanding the company’s Ocotillo campus in Chandler, Arizona.

With a 51% stake, Intel will retain majority ownership and operating control of the two proposed new chip factories, which will support long-term demand and provide capacity for Intel Foundry Services (IFS) customers.

Announcing the deal, Intel CFO David Zinsner said the arrangement builds on the momentum from the recent passage of the CHIPS Act in the U.S.

“Semiconductor manufacturing is among the most capital-intensive industries in the world, and Intel’s bold IDM 2.0 strategy demands a unique funding approach,” he said.

“Our agreement with Brookfield is a first for our industry, and we expect it will allow us to increase flexibility while maintaining capacity on our balance sheet to create a more distributed and resilient supply chain.”

SCIP forms a key component of Intel’s Smart Capital approach, a framework designed to adjust quickly to opportunities in the market while also managing capital spending. Essentially, the structure allows Intel to access strategically-aligned capital to increase its flexibility and scale its manufacturing build-outs.

It’s the latest step in the company’s efforts to become less reliant on overseas manufacturers such as Taiwan’s TSMC and South Korea’s Samsung, following an extended period of supply chain disruption.

“We expect that SCIP, combined with the other pillars of our Smart Capital approach, will allow us to significantly accelerate our transformation and help deliver the more globally balanced supply chain the world needs,” Zinsner added.

The chipmaker said its partnership with Brookfield will enhance its balance sheet and allow it to tap into a new pool of capital below its cost of equity, while also protecting its cash and debt capacity for future investments.

The move is expected to boost cash flow by $15 billion over the next several years, while also enabling Intel to replicate the co-investment model with other partners in the future.

“By combining Brookfield's access to large-scale capital with Intel’s industry leadership, we are furthering the advancement of leading semiconductor production capabilities,” said Sam Pollock, CEO of Brookfield Infrastructure.

“Leveraging our partnership experience in other industries, we are pleased to come together with Intel in this important investment that will form part of the long-term digital backbone of the global economy.”

As more organisations become data-driven through digital business initiatives, following the events of recent years, IT organisations have felt the pressure of increased demands, particularly regarding skills shortages. Therefore, in order to meet these needs, storage infrastructure needs to transform.

This ESG Showcase report looks at the ways enterprise storage is evolving to meet the needs of the modern business, to include increased levels of automation, cloud-native support, and the flexibility to scale over time.

Download this study now to learn what capabilities to look for in a modern enterprise storage solution, and how Dell EMC PowerStore can help your business innovate.

Provided by

Medium-sized businesses face additional challenges in modernising their data centre storage infrastructure because they lack the resources of larger organisations. Additionally, the market dynamics mean an increasingly competitive landscape, so for them sourcing durable, scalable, and secure IT assets is essential.

This report gives advice on how mid-market organisations can improve the security and reliability of their storage infrastructure, and why refreshing and retiring older infrastructures should be factored into their IT security strategies.

Download now to learn how to:

• Mitigate risks that threaten data
• Ensure availability of storage infrastructure
• and how to improve business agility with trusted data centre storage

Provided by

Intel is set to produce chips for MediaTek using Intel Foundry Services’ (IFS) advanced process technologies.

The agreement is one of the most significant deals the US chip giant has managed to secure since launching IFS last year, in a business space where it competes against the likes of TSMC and Samsung.

The agreement is set to help MediaTek build a more balanced, resilient supply chain through the addition of a new foundry partner with significant capacity in the United States and Europe, the two companies said today while announcing the partnership.

MediaTek plans to use Intel process technologies to manufacture multiple chips for a range of smart edge devices. IFS offers a broad manufacturing platform to do this, with technologies optimised for high performance and low power.

“MediaTek has long adopted a multi-sourcing strategy,” said NS Tsai, corporate senior vice president of Platform Technology & Manufacturing Operations at MediaTek. “We have an existing 5G data card business partnership with Intel, and now extend our relationship to manufacturing smart edge devices through Intel Foundry Services. With its commitment to major capacity expansions, IFS provides value to MediaTek as we seek to create a more diversified supply chain. We look forward to building a long-term partnership to serve the fast-growing demand for our products from customers across the globe.”

The partnership is set to be one of the most significant manufacturing deals Intel has secured since launching IFS last year. The company hoped that IFS would make it a major provider of foundry capacity in the US and Europe, by making custom chips for tech firms and governments and competing with TSMC and Samsung.

The firm’s plan to build its foundry business also aims to address the surging demand for semiconductor manufacturing which was squeezed over the past few years due to a supply shortage.

Intel’s foundry business has already secured other major deals before this MediaTek one, including producing chips for Qualcomm and Amazon last year. This is part of the US chip giant’s plan to regain its lead in the chip-making world by 2025, including by rolling out new chipmaking technologies over the next three years.

The humble laptop has been the backbone of business for many years, but the pandemic has turned this workplace workhorse into an integral part of an employee’s relationship with their employer. This also means that how successful an employee is in their role can often depend on the technology they have access to.

In the old world of on-site technical support, it was possible to keep employees somewhat productive on aging technology. But with the mass shift to hybrid working, this is no longer sustainable. The pandemic clearly caught many businesses off-guard in this respect, with IT departments being forced to hastily equip a dispersed workforce with a whole variety of PCs.

According to research by Forrester in association with Intel, 77% of employees say that PCs are critical to their engagement and productivity at work, but as much as 50% consider their work devices to be out of date or insufficient for their needs. At a time when nearly 40% of companies anticipate the majority of their staff being hybrid at some stage in the future, this is a problem. There’s a real danger that many department heads and decision makers may have blinded themselves to the benefits that generous hybrid working policies create, ignoring any resentment and frustration among employees at having to do battle with the very tools designed to help them.

Meeting employee needs

It’s no secret that happy workers are productive workers, and there’s nothing worse for sapping enthusiasm than forcing employees to deal with faulty machines.

Data has shown that being able to get on with work that an employee knows matters to the business is one of the biggest drivers of engagement. Likewise, there’s a unique sense of frustration that’s created when technology gets in the way of this work, whether that’s small inconveniences or a complete hardware failure. These instances then stack up, creating a cycle of disengagement.

One source of frustration is the clear disconnect that exists between IT decision makers (ITDMs) and employees, according to a Forrester report sponsored by Intel. The strategies of ITDMs tend to focus on longevity and making the most of investments, at the expense of employee engagement. For example, the analyst house found that many ITDMs still regard the integration of devices and software as the most important factor in employee engagement, while employees report being happiest when they can easily access information critical to their role and have a device that works consistently.

This disconnect, whether the result of poor communication, lack of resources or poor business agility, has the potential to undermine your workforce and create burnout. This is especially concerning given that only 33% of employees in Forrester’s report were extremely satisfied with the device given to them by their employer, and that only 30% felt its capabilities worked well with other teams.

Some companies have already started to address this disconnect, and have worked to create new strategies that result in higher spending on equipment – essentially viewing higher technology costs as an investment into their employee experience. According to an Intel-sponsored Forrester report, IT leaders have reported a five-fold return on these investments within the last few years, with every $1 spent translating to $5 in increased productivity, in addition to greater business agility and, in turn, customer satisfaction. Overall, a 5% increase in employee engagement is said to lead to a 3% increase in bottom-line revenue, according to Forrester.

This is what happens when ITDMs get it right and that's where laptops on Intel vPro®, An Intel® Evo™ Design come into play. These laptops simplify the process of equipping a workforce with solutions that meet the needs of every stakeholder. Intel has worked with manufacturers to create business-class, ultraportable laptops that are light, thin and optimized for today’s hybrid office.

Employees need to feel like they truly matter in an organization, and this can be reflected in the PC technology they are given. This isn’t to say that you necessarily need to supply your employees with the shiniest devices on the market – but they do need to be tailored to their roles. It’s critical to listen to your employees when it comes to acquiring new technology, as it’s easy to overspend and underdeliver.

As a baseline, the workforce should have access to modern, ultra-lightweight laptops. Employees need to be able to feel that their device is a work companion, and have the confidence that they can take it wherever they need to be – whether that’s changing floors in an office building, catching a train or working from a cafe. Every Intel vPro, An Intel Evo Design-based laptop is built for this reality, and is packed with features to support the way your team really works, such as having multiple applications open at once, heavy media use or constant toggling. With lightning-fast responsiveness, smooth multitasking, seamless use of multiple popular enterprise applications and the ability for IT to offer remote support from anywhere, these laptops have all the features your team needs to be productive wherever they are.

When it comes to functionality, employees should be given a much greater say in the decision process. For example, 2:1 convertible laptops that can seamlessly go from laptop to tablet offer unparalleled flexibility, and are ideally suited to frontline workers. Laptops on Intel vPro, An Intel Evo Design include a wide range of devices and accessories for employees to choose from, safe in the knowledge that they all meet the needs of the business.

A question of security

Perhaps one of the most important things to get right in any business is cyber security. A data breach or ransomware attack can effectively destroy a business overnight; even if it were to recover from the initial attack, the lasting reputational damage can be difficult to overcome.

Keeping your team’s laptops up to date is one of the most effective ways to protect your business. Not only do modern machines tend to come with better built-in security and are less vulnerable to historic hardware vulnerabilities, they also help limit the burden placed on employees to stay vigilant at all times.

In terms of the hardware itself, vendors are becoming better at baking in security measures that address the most challenging cyber security threats facing businesses today. Laptops on Intel vPro, An Intel Evo Design, for example, include application and data protection, advanced threat detection and protection against ransomware and crypto mining.

These defensive capabilities built into laptops significantly reduce the need for additional layers of security at the software level. The proliferation of cyber security software – such as two factor authentication or timed access to systems – may put IT departments at ease, but they can be a source of frustration for employees.

Research from the Harvard Business Review found that, over a 10 day study, 67% of employees violated one or more cyber security policies, but the reasons for doing so were all related to frustration over software getting in the way of them doing their jobs. Specifically, some claimed that they were more likely to violate the rules if they were worried following them would negatively affect productivity, while others said they would do so if the policies forced them to change how they worked.

Simply put, by rolling out Intel vPro, An Intel Evo Design-based laptops across your team, you’re doing your part in providing the fundamental security that your business needs, without infringing on the everyday experience of your team members.

In a world of hybrid working, hardware has become one of the most important factors for establishing and maintaining a happy workforce. Achieving that medium where the needs of employees and business converge can be challenging, but it’s fundamental for any businesses hoping to stay competitive in the modern world.

Learn more about Intel vPro, An Intel Evo Design and how it can benefit your team

Intel technologies may require enabled hardware, software or service activation. No product or component can be absolutely secure. Your costs and results may vary.

@Intel Corp. Intel, the Intel logo, Intel vPro® and other Intel marks are trademarks of Intel Corporation or its subsidiaries. Other names and brands may be claimed as the property of others.

Perhaps the only thing more confusing about buying a new business laptop - or an array of them for an entire workforce - besides the sheer amount of choice on the market, is the myriad different components that equip each model. Laptops vary wildly in terms of technical specifications, so it’s important to understand how each will impact your workers’ ability to get their jobs done.

The central processing unit (CPU), sometimes simply referred to as the ‘processor’, can be seen as the heart, eyes, ears, and brain of the laptop, and is arguably the most important component of the entire device. The confusion here, again, lies in the amount of choice on offer. There are so many different models from different manufacturers on the market, it can feel overwhelming to choose one, especially when the machine will have a direct impact on the quality of work your business is able to produce.

It also doesn’t help that manufacturers don’t make it easy to truly understand what each CPU model will provide you in terms of performance. Many often stick with old hardware conventions, opting for initialisms and numbers in the thousands rather than something a little more explicit. Users often find themselves trawling through comparison websites and social media recommendations before ultimately landing on the CPU they end up purchasing.

That said, there are a few things to know before buying a laptop and understanding what makes a good processor could lead to a better, more productive purchase that stands the test of time, no matter what your business can throw at it.

The best laptop processor

Put simply, there is no straight answer to the question ‘what is the best laptop processor?’ The answer depends on a multitude of factors, many of which relate to the type of work for which you plan to use the business laptop. It will also depend largely on your budget, as laptop CPUs can get eye-wateringly expensive the more ‘premium’ you go.

Before buying a laptop, you need to have a strong idea of what you need the machine to do. Running software for general office work like Microsoft Office 365 is the base standard level of functionality most businesses expect, but some will demand more depending on the job role. For example, you’re unlikely to want to equip an office administrator with the same device as a senior software engineer because the computational demands of a programmer will most likely far exceed those of a more general office worker.

As an easy rule, the best laptop CPU for your business is almost always going to be the most powerful chip you can afford. So, set a budget, understand what you need from the device, and take things from there. But before you go shopping, knowing the differences between manufacturers is hugely important as it could affect performance and compatibility in the long term.

Is Intel or AMD better?

There are two main manufacturers of laptop CPUs on the market today and they are AMD and Intel. Like the allegiances held among devout Xbox and PlayStation console owners, the fanbase for each company can be equally loyal at times, and which is better is ultimately a matter of preference and timing.

Timing is key when making a business laptop purchasing decision, especially when it comes to CPUs. This is because the two companies have been locked in battle for years, each being considered the best manufacturer at different times. Historically, and now again in the present, Intel is considered to make the faster CPUs thanks to its latest 12th-generation Alder Lake chip architecture. However, AMD stole Intel’s crown for a few years recently with its Ryzen 5000-series line of CPUs. These were considered to be vastly superior chips to Intel’s 10th and 11th-generation chips at the time, so if you’re planning to buy an older laptop, or a used machine, then it would be best to check the dates and model numbers to ensure you’re not getting a sub-optimal setup.

CPU naming conventions can be confusing but, fortunately, when it comes to filtering out the Intel chips to avoid, the company’s model numbers clearly specify which generation of chips the model comes from. Each model number starts with the number corresponding to the generation of chips it's from, so an ‘Intel Core i7-12650HX’ processor tells you it’s from the latest 12th-generation line of chips because the model number begins with 12.

A quick way to differentiate the two manufacturers in today’s market is to say that Intel offers better performance, but AMD’s CPUs are more power-efficient and won’t run as hot - generally speaking. Regardless of which manufacturer you choose, you’ll get a highly capable device thanks to modern technology, but if you want the very best on the market, Intel takes the top spot… for now, anyway.

How to choose between an Intel or AMD processor

Intel

Intel’s consumer-grade CPUs come in four main tiers:

• Not the least powerful chip Intel produces but the least powerful we recommend for business use. This is functional for basic office software but not anything more computationally demanding, like photo editing software, for example.
• The happy middle ground that will suit most businesses. Laptops equipped with an Intel Core i5 will breeze through basic software and run more demanding programs well in some cases, but others may experience some lag or stuttering.
• The i7 range is a favourite among the enthusiast crowd and is powerful enough to handle almost any software a business could need with ease. These models are typically much more expensive than an i3 or i5, so they should only be considered if your budget is large or if there is a genuine business need for such performance.
• A more recent addition to the consumer-grade lineup, the i9 is unlikely to be found on many business-focused laptops, but is one of the best models available if your business needs laptops to run many computationally demanding tasks all at the same time, for example.

AMD

Handily, AMD’s naming structure for its flagship line of chips is very similar to Intel’s, in that the most affordable series is indicated by the number 3 in the Ryzen 3 line, and the best performance is offered by the Ryzen 9 chips. It’s worth noting that the most recent Ryzen 6000 chips eliminate the 3-series, however, offering just Ryzen 5, 7, and 9.

Each tier can broadly be characterised in the same way that Intel’s can, too, which is to say the Ryzen 5 is like the i5 - they are both the happy middle ground, while the Ryzen 7 and i7 are both high-end chips that will run almost anything well. The full list of AMD’s consumer-grade CPUs that we’d also recommend for business are as follows:

• AMD Ryzen 3
• AMD Ryzen 5
• AMD Ryzen 7
• AMD Ryzen 9

If you’ve already done some research into AMD Ryzen chips, you may have encountered the company’s AMD Ryzen Mobile Processors for Business line of chips. These may appear to be different to the normal Ryzen Mobile CPUs, but the chips themselves are the same.

Intel vPro vs AMD Ryzen Pro

However, there are also AMD’s Ryzen Pro Mobile Processors for Business, and Intel has its own equivalent line called vPro. These chips are almost identical in terms of performance, but are aimed at businesses who want additional features that could improve things like cyber security and management, for example.

Both Intel vPro and Ryzen Pro use the same model naming schemes as described previously, but offer features like additional security layers to prevent cyber security vulnerabilities. Both AMD and Intel have worked with Microsoft to offer Secured-Core PCs which protect against firmware-level cyber attacks and offer extra provisions for securing sensitive data - somewhat important given today’s data regulatory climate.

The extra features that come with these lines of chips could be hugely beneficial to your business so it’s worth having a conversation with your IT team to decide if they are worth the extra money, and the time it would take to configure for an entire workforce.

Business laptop CPUs to avoid

Intel and AMD also have other consumer-grade CPUs on the market but no others we would feel comfortable recommending for business use. Intel has its Pentium and Celeron lines which, in our opinion, do not offer enough performance to run a business machine seamlessly, and all the software it typically requires. Equally, AMD’s Athlon CPUs will offer performance that will likely leave your workers needing more to get the job done well.

The potential savings to be made by choosing a lower-spec model over the ones we recommend can seem attractive, but when you consider how long you want the machine for and factor in degrading performance over time, it’s better to invest more at the outset rather than having to replace the laptop a year down the road.

Intel has started informing customers of a planned price hike for products in various market segments, while internal sources have reportedly revealed the prices will begin to rise in Autumn 2022 due to the rising costs of production.

The company told IT Pro its plan to raise prices was previously announced in its Q1 2022 earnings call but further details on the products and business segments that will see the hike are yet to be revealed.

According to sources speaking to Nikkei Asia, the products included in the price rise will include those that are core to its PC and server business, in addition to other areas such as the chips required for networking products.

Intel told IT Pro that it has not publicly disclosed the specifics of the price changes, nor has it publicly disclosed the impacted products. However, one source speaking to Nikkei Asia said the percentage increases could be anywhere between the single-digit range and maybe even more than 20%.

A similar price rise was also announced by TSMC, the world’s largest contract chipmaker, saying it planned to hike prices similarly by up to 20%.

The increases may also vary depending on the type of chip. When IT Pro approached Intel for confirmation of the reports, the company said: "On its Q1 earnings call, Intel indicated that it would increase pricing in certain segments of the business due to inflationary pressures. The company has begun to inform customers of these changes".

The semiconductor shortage in the technology industry is well documented and has persisted since 2020 after a range of different factors, such as geopolitical tensions, pandemic-related shifts in demand, and disruptions at foundries across the globe, among other factors, all culminated in a global shortage.

Most businesses that rely on semiconductors have felt the effects of the scarcity, including the GPU market that has famously impacted the video game industry and PC builders.

Cisco is another major company that has experienced financial hardship as a result of the shortage, with the company thought to be sitting on a backlog of orders that it currently can’t fulfil worth billions of dollars.

Most nations around the world are now facing rising inflation rates, in part due to the ongoing war between Ukraine and Russia, combined with the lingering pandemic-related hits to their economies.

It was revealed this week that both the US and UK's inflation rates hit 40-year highs of 9.1%, while the average for countries with advanced economies, members of the Organisation for Economic Cooperation and Development (OECD), has at least doubled since 2020.

The UK is facing a cost of living crisis as consumer prices in areas such as utilities have soared in recent months, and will continue to soar into the new year, according to forecasts.

A quarter of UK businesses are also expecting to raise their prices as a result of rising inflation rates, according ONS figures.

Intel admitted in its most recent earnings report that “the pandemic has significantly increased economic and demand uncertainty,” and that the “demand for [its] products could be materially harmed in the future” as a result.

Questions around when the chip shortage will end are currently met with mixed predictions and Intel had previously warned that it could extend well into 2023.

The technology we use at work is central to our day-to-day lives, giving us access to the systems we need and allowing us to share the work we create. We need to be able to rely on it to support us quickly and seamlessly, so it stands to reason that offering the right technology is key for businesses to attract and retain talent in the modern workplace.

"The PCs a company deploys can directly impact the quality of a candidate they can hire," reads an IDC White Paper commissioned by Intel*. "Increasingly, workers are making decisions about what jobs to take based upon the hardware employers have on offer."

The same paper found that 72% of enterprise IT decision-makers (ITDMs) see the right technology as vital to recruiting and retaining talent.

In a survey of Employee Experience (EX) exploring the KPIs which IT departments are tracking, 43% of respondents said that they had seen a "substantial positive impact" when it comes to the ability to attract the best talent, and 43% said they'd seen a "moderate positive impact."**

For Gen-Z, technology is a dealbreaker when considering new roles. Some 91% said access to cutting edge technology would influence their job choice among similar employment offers†. There is evidence that it can even impact whether employees are willing to recruit friends and family to their business. To make your business attractive to new employees, offering responsive and reliable technology that allows people to get on with their work without unnecessary interruption is a clear must.

A change of form

So, what are potential employees looking for in their PCs? To attract the best new workers, you need to be embracing new form factors, notably ultra-slim, convertible and detachable laptops – like those in the Intel vPro®, An Intel® Evo™ Design range – which "allow adaptability to the way workers are accessing, working with, and managing data", according to IDC's report.

The remote and hybrid working practices that have boomed in recent years have naturally increased the need for competitive businesses to invest in technology.

"People want the environment that's best for them," said Accenture's Technology Trends Report 2021††. "For some, that will mean going back to the office; for some it will mean going 100% remote, and still, others will want a mix. But regardless, this new approach is something businesses must accommodate rather than fight."

Likewise, potential new employees will judge your company based on the technology you can offer. Between an organization with an aging fleet of laptops and one with the newest hardware designed to support the demands of our new hybrid working models, the latter has a clear advantage.

Remote working means switching to cloud-based platforms and more people logging in from the home environment, raising the bar on data security.

Security is a top priority for mid-market organizations (500-1000 employees), with 88% mentioning it as their top priority or a priority in a recent report by Forrester (2021) commissioned by Intel§. With security such an important issue, workers want to know that their machines are sufficiently protected – for the company's sake, and so that they don't find themselves implicated in any serious breaches.

Paying dividends: an investment in the future

Keeping staff happy is paramount in the wake of the so-called ‘Great Resignation’, and technology can significantly boost employee experience (EX).

Over three-quarters of full-time employees surveyed said PCs are critical in their engagement and daily work. In addition, they agreed that PC devices are critical for customer satisfaction (69%), revenue growth (62%), and employee retention (55%)**.

The report also found that technology has the most significant impact on EX of the KPIs employers currently track. Nearly 60% of IT decision makers have seen more than 10% improvement in their EX scores by focusing on improving employees' satisfaction with technology.

"IT decision-makers are recognizing that there is a straight line connecting good technology and good employee experiences," reads the report. "They are therefore investing in technology improvements across the board. This connection was brought further into focus with the outbreak of the COVID-19 pandemic."

Investing in EX reaps financial rewards. Businesses can see a 5x return on investing EX, while a 5% increase in employee engagement leads to a 3% increase in bottom-line revenue**.

Plus, by ensuring that EX is high, your company will be more attractive to new hires, as well as offering an environment where they will want to stay in the long term.

Meeting the demands of a hybrid workforce

In 2020, many companies lacked the 'digital foundation' to pivot to a remote working environment – one that's almost certainly here to stay under new hybrid working models.

To develop this foundation, organizations need to regularly refresh hardware to support their working practices.

Laptops on Intel vPro®, An Intel® Evo™ Design offer a range of features like lightning-fast responsiveness, smooth multitasking capabilities and powerful security measures to support users, and are also easy to manage for IT managers and organizations. By delivering reliable hardware that can be quickly and efficiently managed remotely when troubleshooting is needed – and also reliably supports now-essential activities like video conferencing – these newer devices can help support workers in their day-to-day activities and reduce downtime, ensuring that EX is maximized wherever they're based.

Boosting EX with Intel vPro, An Intel Evo Design

Intel vPro, An Intel Evo Design-based laptops can help to deliver better performance for employees, boosting their productivity and minimizing the frustrating delays caused when hardware cannot keep up with the demands of the user. Batteries charge faster and last longer, and there's more power, too. By enabling workers to feel more productive, you can ensure a better employee experience.

Customer feedback confirms that Intel vPro®, An Intel® Evo™ Design-based laptops are easier to manage, helping to insulate employees from many of the delays associated with hardware issues so that they can instead focus on what really matters – their work.

The bottom line is that when employees get the right tools and their PCs work well, they are more productive, happier and can work creatively and collaboratively.

Laptops on Intel vPro®, An Intel® Evo™ Design are tools designed for the modern workplace, helping to build and support the hybrid working environment modern employees expect. By giving your team these business-class laptops, you can help keep EX high and make your organization a more attractive prospect.

Learn more about Intel vPro, An Intel Evo Design and how it can benefit your business

Intel technologies may require enabled hardware, software or service activation. No product or component can be absolutely secure. Your costs and results may vary.

@Intel Corp. Intel, the Intel logo, Intel vPro®, Evo™, and other Intel marks are trademarks of Intel Corporation or its subsidiaries. Other names and brands may be claimed as the property of others.

*Source, IDC white paper hosted on Intel UK’s website

** Source, Forrester Research, Invest In Employee Experience (EX), Drive Your Bottom Line Growth, October 2020

† Source, Dell, as cited by Elite Group

†† Source, Accenture's Technology Trends Report 2021

§ Source, Forrester Total Economic Impact of the Intel vPro® Platform

Much was made of the so-called Great Resignation that began to affect businesses of all types and sizes just a few months ago, with the ‘new normal’ we’re all settling into driving many employees to seek new pastures.

For businesses, it’s become more important than ever to retain existing skills within an organization as well as take advantage of the labor market in flux by recruiting workers where possible. Key to this staffing drive are business-grade PCs powered by Intel vPro, An Intel Evo Design delivering a proliferation of productivity-oriented and security-centric features that help employees to do their best work from anywhere.

This is a family of PC hardware features embedded in a plethora of modern business-class PCs with Intel vPro-enabled chipsets that equip business users with the security, productivity, video-conferencing quality and networking capabilities needed to thrive in a more fluid business environment.

Indeed, with the advent of remote work also becoming something more businesses are incorporating into their strategies, it’s critical to provide these workers with machines primed for an unrivaled on-the-go business laptop experience.

Why hardware is critical to the employee experience

One of the most important factors in the all-important equation of talent recruitment and retention is undoubtedly hardware, and the choice of PCs employers offer their workers. PC technology has a significant impact on both the employee experience and job satisfaction, with much more prevalent remote work arrangements also driving the need for corporate PCs to be top notch.

In fact, the vast majority of IT decision-makers (72%) recognized that device choice was very important to their capacity to recruit and retain talented workers, according to findings from IDC published in 2020. The PC in a Data-Centric World report also highlighted 64% of workers saying the hardware they use affects their productivity, while 62% say it influences their workplace satisfaction levels. A further 56% said the technology provided by their employer affected their willingness to stay at the company in the long term.

Indeed, regardless of whether they work from home or work from an office, workers want to feel as productive as possible and that what they’re doing has a direct influence on their organization. Technology such as Intel vPro, An Intel Evo Design is critical to the overall employee experience and supplying machines fitted with advanced technology will aid an organization’s aim to attract skills and retain top talent.

What the Intel vPro, An Intel Evo Design platform offers businesses

The technologies that fall under the Intel vPro, An Intel Evo Design umbrella are primed to deliver high-performance capabilities and hardware-level security for business users. Additionally, the manageability that these devices allow renders them ideal for organizations with sophisticated or maturing IT.

Multilayer security features, including hardware-based measures, are coupled with active threat monitoring to help protect resources and business data. This comes alongside the nature of Intel vPro, An Intel Evo Design-based laptop or 2-in-1s, which are verified slender and lightweight machines powered exclusively by 12th Gen Intel Core processors.

In practice, these machines deliver four or more hours of real-world battery life in a 30-minute charge alongside an all-day battery life on full-charge, so workers can stay on the go for longer. Employees, especially those working remotely, can run video conferencing and other critical business apps throughout a working day without fear of running out of juice. These machines also offer vastly improved responsiveness and instant wake, so they can keep up with the user, supporting smooth multitasking and not frustrating users by making them wait for their PC to catch up.

One of the most significant benefits, meanwhile, is allowing a business’ IT department to remotely manage and diagnose a potentially faulty Intel vPro, An Intel Evo Design-based laptop or 2-in-1s from afar. Teams can be fully supported by IT even when they are working remotely outside of the corporate firewall. IT can help them whenever and wherever, so if they are in a pinch right before a critical customer meeting they are not left to figure things out on their own.

Should users catch a virus or require an urgent update, the Intel vPro, An Intel Evo Design platform allows administrators to easily log into managed systems to instigate the necessary actions. It also enables companies to use the same versions of applications universally, and that all PCs are up to date.

Why embrace cutting-edge Intel vPro, An Intel Evo Design-based laptops?

Ultimately, workers rely on their PCs to perform a majority of their work and the PC they use matters to them just as much as many other factors that feed into their job satisfaction, and their likelihood of staying at an organization. In fact, a Forrester report published in October 2020 found that 77% of full-time workers surveyed said their PC devices are a critical factor in engagement and daily work, mirroring the findings of the IDC report. Of those asked, 69% also found PCs are critical for customer satisfaction, while 62% and 55% reported they were key to revenue growth and employee retention respectively.

Investing in enhancing employee engagement and productivity by embracing machines powered by the Intel vPro, An Intel Evo Design platform can also have a direct impact on financial performance. The Forrester report suggests that a 5% boost in employee engagement directly translates to a 3% increase in bottom-line revenue. Moreover, the study found that 60% of IT decision-makers said boosting an employee’s satisfaction levels with technology had a substantial effect on EX metrics.

Ultimately, in our new normal in which the state of the labor market is constantly shifting and in which businesses must strive to ensure they’re doing everything they can to retain talent and attract skills, it’s critical they pay attention to hardware provision. PC technology such as the Intel vPro, An Intel Evo Design family is critical to boosting the employee experience, while businesses are given all the tools they need to manage their fleet of devices and that your team is supported in doing their best work whatever their circumstances. Intel vPro, An Intel Evo Design offers the best on-the-go business laptop experience and is built to give employees what they want and IT departments what they need, with the platform tailor-made to cater for how teams work in the new normal.

Learn more about Intel vPro, An Intel Evo Design and how it can benefit your business

Intel technologies may require enabled hardware, software or service activation. No product or component can be absolutely secure. Your costs and results may vary.

@Intel Corp. Intel, the Intel logo, Intel vPro® and other Intel marks are trademarks of Intel Corporation or its subsidiaries. Other names and brands may be claimed as the property of others