Intel (INTC) Goes For The Kill With AMD (AMD) And Nvidia (NVDA)

By Douglas A. McIntyre Updated Apr 27, 11:37PM EDT · Published Aug 4, 5:40AM EDT

Follow 24/7 Wall St. on Google

This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.

Intel (INTC) is about to hit the market with a new set of graphics chips and they are aimed directly at the hearts of Nvidia (NVDA) and AMD (AMD) which both count of the expensive products for large portions of their sales.

According to The Wall Street Journal, "Intel could gain as much as $4.6 billion in new revenue in 2010 if it matched Nvidia’s and AMD’s market shares in specialized products, known as GPUs or graphics-processing units."

AMD and Nvidia have problems so severe that they may not be able to be solved soon. AMD bought graphics chip maker ATI. The deal has been a bust and AMD is saddled with $5 billion in debt and no operating income. Nvidia missed its last quarter badly and its shares are down over 60% during the last year.

The margins in the chip market are already eroding and a slow global economy could cut into bread-and-butter PC and server sales.

Intel putting its heft against one more segment of the industry is likely to cut even its own margins as price becomes a critical factor in picking up new customers.

Intel can afford the modest margins, at least for a time. Its competition cannot.

Douglas A. McIntyre

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.