Intel told investors lower-than-expected revenue from Chinese cloud vendors contributed to a choppy Q3, a sign recent political moves in the country may have global repercussions.
On its earnings call, CEO Pat Gelsinger explained Chinese cloud equipment manufacturers had adjusted to meet regulations on gaming in the country, after a clampdown [1] on the hours children can play for.
CFO George Davis noted the issues impacting Intel’s business in China will continue in the current quarter. He also announced retirement plans on the call.
A soft cloud business impacted Intel’s Q1 [2], though at the time it was bullish on a recovery.
As in previous quarters, Gelsinger noted cloud-native deployments by mobile operators continue, claiming half of all new core network deployments are now using off-the-shelf servers and predicting this would reach 80 per cent by 2024.
Virtualised RAN (vRAN) is on the horizon, Gelsinger forecast noting Intel’s work with Verizon and Dish Network.
“We expect global vRAN base station deployments to move from hundreds to hundreds of thousands and eventually millions with private 5G over the next several years”.
Gelsinger noted supply chain issues remained a weight during Q3, explaining “the server business is constrained” and “ethernet controllers and power supply devices” held Intel back.
“We would be shipping a lot more units…if we weren’t constrained by the supply chain of these other components in the industry”.
Net income was $6.8 billion, up 60 per cent on Q3 2020, with revenue 5 per cent higher at $19.2 billion.
[1] https://www.mobileworldlive.com/featured-content/home-banner/china-bans-children-from-school-night-gaming
[2] https://www.mobileworldlive.com/featured-content/top-three/cloud-rains-on-intel
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