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Intel and Samsung post record earnings despite chip shortages

Despite the chip shortage bedeviling the global industry, directly affecting their businesses, Intel and Samsung have posted record quarterly performances.

Intel’s business requires lots of chips, as a maker of PCs. And with increasing demand for PCs, the company has struggled to meet its potential in the last quarter. But that didn’t stop it from earning its highest quarterly and yearly revenues, standing at $19.5 billion and $74.7 billion, respectively.

However, profits took a hit, coming in at $4.6 billion and $19.9 billion, respectively. It meant profit dipped by 21 percent in the quarter while revenue $19.9 billion.

Other parts of the reports are not so rosy, with laptop revenue shrinking by 16 percent year-on-year. However, the problem was that Intel couldn’t produce as much as it wanted, although the average selling price jumped by 14 percent.

The desktop business improved, however, and combined with other divisions, Intel was able to make up for the lost revenue on the laptops.

Other businesses that appreciated include data center with a 20 percent increase to fetch $7.3 billion. The Internet of Things Group, IOTG, and Mobileye went up 36 percent and 7 percent, respectively, compared to the same period in 2020.

CEO Pat Gelsinger predicted that the chip shortage would persist till 2023, meaning Intel won’t be able to capitalize fully on the resurgence. Gartner and IDC reported that more than 340 million PCs were shipped in 2021, but it could have been more if manufacturers like Intel had been able to reach their full capacities.

He commented on the performance, “Shortages in substrates, components, and foundry silicon has limited our customers’ ability to ship and finish systems across the industry. This was most acutely felt in the client market, particularly in notebooks, but constraints have widely impacted other markets, including automotive, the internet of things, and the data center. As we predicted, these ecosystem constraints are expected to persist throughout 2022 and into 2023 with incremental improvements over this period,”

Intel is making some huge bets, with a new $20 billion plant announced for Ohio recently.

Meanwhile, Samsung reported massive numbers as well, setting new quarterly and yearly records. The South Korean conglomerate reported $11.5 billion in profit from a revenue of $63.6 billion for the last quarter of 2021. Profit and revenue for the whole year stood at $42.9 billion and $232.4 billion, respectively.

According to Samsung, the revenue growth (24 percent) was mainly due to increased sales of high-end smartphones, TVs, and other appliances. The 52 percent jump in profit was boosted by its semiconductor business.

Samsung expects even more growth in 2022 in its mobile business, powered by new premium phones, tablets, and wearables. Its display division is also expected to expand thanks to the anticipated increase in foldable phone production.

Samsung also expects huge returns on its recent investment into quantum-dot OLED TV panels and expects it to make up for the losses it has seen in its large panels.

The first premium phones of this year will be released at the company’s yearly Unpacked event on February 9th. The head of Samsung’s mobile business has hinted that the famous Galaxy Note line will be laid to pasture, with the Ultra coming in as its replacement.

Samsung expects to feel some impacts of the COVID pandemic and chip shortage but is confident of increased sales of its flagship devices.

Written by HackerVibes

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