In a move it hopes will help revive personal computer (PC) sales, Intel Corp. (NASDAQ: INTC) is overhauling its flagship line of computer chips. The sixth generation of its Core processor family is based on a design known as Skylake. It aims to boost performance and reduce power consumption of PCs. The company also says that Skylake could reduce the number of wires that computer users need, as well as replace passwords with facial-recognition technology.
These new, long-awaited Intel chips follow the recent launch of Microsoft Corp.’s (NASDAQ: MSFT) Windows 10 operating system. The two companies hope to boost demand for PCs in a shrinking market with their new hardware and software.
The iconic chip giant had a stellar 2014 on the tailwind from continued PC sales, but this year has been a far different story, as it has lagged high-growth specialty chip stocks. Intel remains the largest semiconductor company in the world and controls nearly 80% of the microprocessor market. But it wants to be at the center of what is known as the current computing revolution.
The first wave of computing focused on personal computers, and then laptops, where Intel was dominant. But with ever more computing becoming about the mobile revolution and connected devices like smartphones and tablets, Intel also wants to boost its foothold in these areas, while maintaining its leadership within servers that power data centers. If any company has the deep pockets to hold on to its strength and forge new ones, it is this Silicon Valley giant.
Short sellers continue to bet against the company, though in shrinking numbers. Earlier this week, Northland Securities upgraded the stock to Outperform from Market Perform, while Canaccord Genuity reiterated its Buy rating. Shares are down about 23% year to date and closed at $27.28 on Tuesday. Intel has a consensus price target of $33.20 and a 52-week range of $24.87 to $37.90.
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