With a shift in focus from PCs to smartphones among other computing devices, Intel has lowered its expectations in term of Q1 revenue by a margin of $900 million and which is due April 14.
While earlier it was $13.7 billion plus or minus $500 million, that figure has been brought down to $12.8 billion plus or minus $300 million.
In explaining the reason for this change, Intel wrote, “The change in revenue outlook is a result of weaker than expected demand for business desktop PCs and lower than expected inventory levels across the PC supply chain. The company believes the changes to demand and inventory patterns are caused by lower than expected Windows XP refresh in small and medium business and increasingly challenging macroeconomic and currency conditions, particularly in Europe.”
It’s clear that the slower response on a Windows refresh will have an impact on companies in the PC industry as well since they also depend on consumers to upgrade their computers so as to keep up with operating system changes.
What will be interesting to see is the impact this has on Microsoft given that it is likely to experience slower-than-likely sales of its latest software.
As for Intel, a substantial part of its investment has been made in areas such as intelligent computing as well as wearables, thanks to the decline that it is facing in other parts of its business. However, one clear reason why it has been doing this is to build markets and products where its processors can continue to thrive in the future.
This statement comes at a time when a number of companies are building smaller and lighter computers that are neither smartphones, desktop PCs or tablets.