SWOT Analysis Intel | Intel Strengths, Weaknesses, Opportunities and Threats.
1. What is Intel?
Intel is a semiconductor manufacturing company headquartered in Santa Clara, California. It was founded by Robert Noyce and Gordon Moore in the year 1968.
The current CEO of the Company is Patrick P. Gelsinger. Microprocessors are provided by Intel to computer system makers such as Lenovo, HP, and Dell.
Intel also makes motherboard chipsets, network interface controllers, and integrated circuits, as well as flash memory, graphics chips, embedded CPUs, and other communications and computer equipment.
2. How is the Business Model of Intel?
Intel is a multinational corporation that was founded all the way back in 1968. Currently, Intel is one of the most influential companies in the world with their worth totaling to more than $190 billion dollars.
Intel has a global reach with their products being found in almost every country around the world.
There are many aspects to Intel. They are a chip company, providing processors for computers and servers, as well as cyber security devices.
They are also one of the largest information technology companies in the world with their most profitable business being their semiconductor business.
The business has the following categories;
a) Client Computing Group: This is a group that makes processors for client computing which include Ultrabooks, All-in-one computers, tablets, and notebooks. The segment delivers client computing end-user solutions. Its primary focus is upon the higher growth segments
b) Data Center Group: This group makes processors for servers and data centers. Among the main customers of the DCG segment are cloud service providers, enterprise and government, and communications service provider.
c) Non-volatile Memory Solutions Group: In this group the major task of this group is to make NAND flash memory chips and FPGA chips. The customers of this segment are enterprise and cloud-based data centers, users of business and consumer desktops and laptops, and a variety of Internet of Things application providers.
d)Internet of Things Group: This is a group that makes processors for wireless communications The customers of IOTG include retailers, manufacturers, health care providers, energy companies, automakers, and governments. Intel through its IOTG services helps its customers create, store, and process data generated by connected devices to accelerate business transformations customers of IOTG include retailers, manufacturers, health care providers, energy companies, automakers, and governments. Intel through its IOTG services helps its customers create, store, and process data generated by connected devices to accelerate business transformations
e) Programmable Solutions Group: The major responsibility of this group is to make programmable chips for enterprise servers and embedded systems.
f) Intel Security Group: This group makes security software products.
3. How does Intel makes money?
The company operates in many different industries, from manufacturing of semiconductors to cloud computing services.
Given this diversity of the company, it seems as if Intel could have a hard time generating revenue from a single industry.
However, that is not the case. Intel earns the majority of its revenue from the sale of semiconductors.
In addition, the company has a large business in chipsets and connectivity devices.
Intel makes money by selling computer chips and computer processors to PC manufacturers, such as Dell and HP.
In particular, Intel sells processors to OEMs, where OEMs assemble and package these components with other hardware, such as computer memory and hard drives, and sell them to other manufacturers.
4. Intel Business Strategies and Plans
Intel has its in-house research in the computing industry.
a) Intel’s in-house research in the computing industry consists of facilities that are devoted to computer processor development, manufacturing, and research. The facilities that consist of Intel Research include fabs, datacenters (datacenters), field laboratories (field facilities), offices, and regional laboratories.
b) Empowering Future with Strategic Propositions: The firm will continue to supply the goods and technology that form the cornerstone for global innovation, thanks to its production and technical capabilities. It also seeks to provide its clients and consumers with the most innovative and engaging technological experiences possible by utilizing new-age drivers.
c) Marketing Strategy for Process Technology: the Company’s goal is to provide computers with less power consumption using necessary technologies.
d) Creating Value through Capital Strategy. Intel is dedicated to fulfilling its corporate duty to produce value for its investors by reducing risks, lowering costs, developing brand value, and expanding into new markets.
e) Strengthening Core with Diverse and Inclusive Talents: Invention, product leadership, deliberate leadership in corporate governance policies, and engagement with suppliers, consumers, regulators, and local communities are all part of the Intel culture, which leads to the creation and deployment of sustainable business practices.
5. Revenue and Financials
Intel’s revenue in 2020 was increasing US$77.87 billion with an operating income of Increase US$23.68 billion, the Company also has a net income of decrease US$20.9 billion.
The total assets of the Company was Increase US$153.09 billion with a total equity of Increase US$81.04 billion. The Company has 110,600 employees as of 2020.
6. Competitors of Intel
The company mainly competed with the companies which are listed below:
a) Advanced Micro Devices: Advanced Micro Devices, Inc. (NASDAQ: AMD) is one of Intel’s major competitor. Advanced Micro Devices serves the computing and graphics markets with its AMD Ryzen, Epyc and Radeon products globally.AMD Ryzen, Threadripper and Epyc CPUs help gamers, creators and professionals achieve their vision.
b) NVidia: NVidia Corporation (NASDAQ: NVDA), founded in 1993, is a company that mainly produces graphics processing units – GPUs for consumer and enterprise markets.
c) Samsung: Samsung Electronics, founded in 1969, is a South Korean electronics company which provides electronics products such as semiconductor devices, displays, memory chips, flash memory and system LSI chips. Its main products are televisions, smartphones and home appliances.
d) International Business Machines (IBM): IBM is a multinational computer technology company, headquartered in Armonk, New York. IBM’s only business is the design, development, and sale of high-end computers, hardware and software systems.
e) VIA Technologies: VIA Technologies, Inc. is a technology company which develops multi-core embedded processors. It also provides graphics processing units (GPUs) and application processors for computer systems under the VIA brand name.
f) Qualcomm: Qualcomm is a multinational semiconductor company that specializes in the research of electronic components for mobile telecommunication, high-speed internet, laptop, tablet and other devices.
- g) Toshiba: Toshiba Corporation is a Japanese multinational conglomerate corporation. The company is based in Chuo-ku, Tokyo, Japan. Their products range from communications systems to industrial equipment, semiconductors to consumer appliances.
7. Partners of Intel
a) AxxonSoft: AxxonSoft is a company which provides solutions for businesses of all sizes.AxxonSoft products help customers to respond faster. The AxxoSoft business model is a subscription-based product pricing method. The AxxoSoft business model is a subscription-based product pricing method.
b) Sogeti: Sogeti is a company that provides the best IT services. Sogeti helps to transform organizations into digital businesses, delivering high value solutions to its clients worldwide.
c) Titanium: Titanium is a company that provides the services of IT security. Titanium helps its customers to detect, prevent and respond to cyber-attacks.
d) AAEON Technology: AAEON Technology is a Taiwan-based company which provides a range of IT hardware and software solutions to customers worldwide.
e) Arrow Electronics: Arrow Electronics is a company which provides innovation and engineering support to companies worldwide. Arrow provides products and services to the electronics, computing and communication and industrial and power markets.
f) Microsoft: Microsoft is an American technology company which develops, manufactures, licenses and supports a family of products, including operating systems for computing devices, servers and phones for home and business.
8. SWOT Analysis of Intel
Strengths of Intel
a) Strong industry position: The Company has strong market share in its major business segments. The main products of the Company are based on technology which is not easily copied especially the PC microprocessors.
b) Economies of scale: The microprocessor market is very large and would be relatively easy to grow with any new entrant. Therefore, Intel has economies of scale in technology and production.
c) Strong research: The Company’s research and development units are world renowned and all major products of the Company incorporate some breakthrough technology that cannot be copied by other manufacturers.
d) Strong partnership with Microsoft: The Company has strong partnerships with Microsoft, which limits the market for competitors to a small portion of the total market.
c) Trustworthy raw material suppliers — the firm has a solid base of reliable raw material suppliers, allowing it to overcome any supply chain bottlenecks.
d) Strong high-tech culture: The Product is very innovative with cutting-edge technology and built on breakthroughs which are not easy to copy.
e) High level of customer satisfaction – the company with its dedicated customer relationship management department has able to achieve a high level of customer satisfaction among present customers and good brand equity among the potential customers.
f) Strong distribution network — Intel has developed a dependable distribution network over the years that can cover the majority of its potential market.
g) High Free Cash Flow – Intel has strong free cash flows, which allow the corporation to grow into new initiatives with resources on hand.
h) Brand recognition: Asclepios has strong brand recognition, owing to the positive perception of its products and the excellent customer service provided by the company.
i) Social media: The Company often invests in social media to reach out to its customers. Due to its investments in social media, Intel has become successful at persuading its customers of using their products.
Weaknesses of Intel
a) High cost of goods: The Company has high fixed costs, which may adversely affect profit margins.
b) High level of debt: The Company has high levels of debt, which increases the interest costs on funds borrowed to finance activities.
c) Declining PC sales: Due to the shrinking PC market and an over dependence on the PC segment, the Company is currently facing challenges.
d) Limited business diversification: The Company is currently facing challenges in diversifying its business by entering the mobile phone, tablet and TV segments.
e) Overproduction: The Company has high levels of overproduction, which may hinder the growth of the company.
f) Service in Developing countries: The Company serves limited number of clients in developing countries, which may detract it from the growth strategy.
g) Weak Research & Development Division: the Company’s Research Division has very less investment compared to the amount of revenue it generates.
Opportunities of Intel:
a) Market growth: the Company’s products are expected to be in high demand as the PC market declines.
b) Demand for Intel products: The increased demand for advanced devices such as personal computers and servers will increase the demand for Intel’s products.
c) Rising PC sales: the growing use of personal computing devices is expected to boost the demand for Intel’s products.
d) Automatic Cars: This is another segment that requires processors and hence presents a great opportunity for a company like Intel
e) Drones: Since drones are on the rise, there is a great market for Intel’s processors.
f) New products: As the company is continuously launching new products, this also presents an opportunity for selling their product in more markets.
g) Developing countries: The Company has a vast market in developing countries, which are being served by the company through their distributors. Hence this presents an opportunity for the company to improve their sales in these markets.
h) New technology: As the company is investing in cutting-edge technologies, there is a great demand for its products among customers.
i) International expansion: Since the international demand for the company’s products is on the rise, this also presents an opportunity to increase their share of this market.
Threats of Intel
a) Competition: Since the company is a leading player in this industry they have been facing the pressure from its competitors. Other competitors include Qualcomm, Samsung, NVidia and AMD.
b) New Product Launches: The competitors of the Company launch new product lines which may provide a threat to the sales of Intel’s products.
c) Price: Many firms aim to win Intel’s business by lowering the price of their goods. A market that is price sensitive will be drawn to considerably lower pricing.
d) Diversifying: Intel has failed to diversify its business strategically. So, the company is facing challenges with its latest venture into the mobile phone market.
e) Fluctuating PC Sales: the Company’s product is extremely PC dependent, which puts it at a great risk in times of falling PC sales.
f) Harmful regulations: The Company’s is currently facing harmful regulations from countries like China who are trying to hinder the sale of their products.
i) Reliance on third party manufacturers: As per analysts, the current business model of Intel rests on third party manufacturers who are more dependent on Intel.
FAQS of Intel?
a) What is Intel known for?
Intel is known for being a leading producer of computer chips. The company Intel makes their money by selling CPUs and other semiconductor parts and components and providing industrial design and development services.
Intel was founded in 1968 and has been a company that has remained successful. Intel is committed to help IT professionals and businesses around the world realize their full potential.
Intel has always been innovative and continues to strive to create new and better innovations.
Intel will not stop until they have the best products and technologies to help people around the world achieve their goals.
Their goal is to make sure everyone has the opportunity for a great life by supplying people with products and services.
b) Who are the competitors of Intel?
There are three main competitors of Intel: AMD, NVIDIA, and Qualcomm. The competition heats up due to the expansion of Huawei into the mobile phone market which has given them access to the markets that were previously under threat by Apple’s iPhones etc.
c) Why is the name Intel?
Robert Noyce and Gordon Moore, two semiconductor pioneers who had departed Fairchild Semiconductor, formed Intel on July 18, 1968. Originally known as “NM Electronics” (for Noyce and Moore), the corporation bought the trademark “Intel,” which stands for “Integrated Electronics.”
d) Who is the CEO of Intel?
Patrick P. Gelsinger (15 Feb 2021–) is the current of the Company.
e) Which countries does Intel operate in?
Intel has operations in more than 60 countries and territories around the world.
f) Why is Intel so successful?
The company is extremely successful due to its products having a high market demand.
g) Is Intel owned by Dell?
No, Intel is not owned by Dell. But the two corporations do have a close business relationship.
h) What country is Intel from?
Intel is a US-based multinational corporation.
I) how did Intel avoid the Great Recession?
Intel has invested in new products that have been growing at a faster rate than personal computers. They have also been able to expand into new technology markets such as server, cars and drones which have been doing better than PC’s.
j) Who owned Intel?
Intel was founded by Robert Noyce and Gordon Moore, two individuals who had left Fairchild Semiconductor.
k) What products does Intel make?
Intel makes chips that are used in personal computers, servers, mobile devices and other electronic products.
l) What is the age of Intel?
Intel is 53 years old
m) How many employees does Intel have?
Intel has over 110,600 employees as of 2020
n) How much revenue does Intel earn?
Intel has earned US$77.87 billion in 2020
o) What is the biggest market of Intel?
The biggest market of Intel is the United States, which is followed by China.
p) What is the best product of Intel?
The best product of Intel is the core i7 (Y series), which is an amazing processor.
q) Where does the Intel stock trade?
The stock of Intel trades on NASDAQ.
r) When was Intel founded?
Intel was founded on July 18, 1968 by Robert Noyce and Gordon Moore, who had both previously worked for Fairchild Semiconductor.
s) How many locations does Intel have?
Intel is headquartered in Santa Clara, CA and has 174 office locations across.