intel brian krzanich

Intel Corporation (NASDAQ:INTC) CEO Brian Krzanich spoke with FOX Business Network’s (FBN) Liz Claman about Intel’s newly unveiled Quark chips, Intel’s dividend, and their business partners across the technology sector. Krzanich said the company’s Quark chips will be in “everything from wristbands and wristwatches…to simple controllers that sit out on an air conditioner out in the middle of nowhere,” and said that, “You’re going to see Intel chips inside a variety of those wearable devices over the next year.” Krzanich also discussed the company’s two-in-one devices, saying, “We call it the best of both worlds…And you’re going to be able to get that at sub-$400.”  When asked whether he will continue to raise Intel’s dividend, he said, “Dividend and stock buyback are both key programs to us to bring value to our shareholders in other ways. As we generate cash, first priority is to push that back into the business, back into research and development, back into new products. Second after that is shareholder return.” Krzanich also discussed Intel Corporation (NASDAQ:INTC)’s relationship with Dell, saying “we’ve all spent time with Michael [Dell] and talked to him over the last couple of months as he’s gone through this process and our relationship shouldn’t change.”

Excerpts from the interview are below.

On what type of products their new Quark chips will be used in:

“You’re going to see this product in everything from wristbands and wristwatches that are smart and connect to the Internet to simple controllers that sit out on an air conditioner out in the middle of nowhere that signal back to the home office that says, I’m OK or I’m not OK.  You need to send a service agent. And so rather than send service agents on a schedule, they can send service agents when they’re needed.”

On whether Intel chips will be inside smart watches:

“You’re going to see Intel chips inside a variety of those wearable devices over the next year. We’ve already got customers signed up. We also already have reference designs to go out and sign up new customers as well.”

On who the customers are that have signed up for Intel chips:

“I am not allowed to say who it is. There are U.S. companies and there are international companies.”

On whether they have both U.S. companies and international companies signing up for Quark chips or at least what they can do in wearables:

“More wearables. Some of them are signing up for Quark in the internet and some of them are signing up for Atom-based products as well.”

On how their relationship with Dell will be impacted if the company goes private:

“We’ve all spent time with Michael and talked to him over the last couple of months as he’s gone through this process and our relationship shouldn’t change. If anything it will just continue to get stronger. He’s got a great plan for what he’s going to do with his company as it goes private and I think he’ll do a good job.”

On whether their partnership is strongest with Asus, Acer, Lenovo, HP, Dell, or Apple:

“Just about all the ones you listed. If you take a look at Bay Trail, it’s a phenomenal product. It’s going to allow us to get into price points- you’re going to see two-in-one devices at sub-$400 price points which is really what customers have been asking for.”

On what a two-in-one device is:

“It’s a laptop and a tablet in one.  It’s really the best, we call it the best of both worlds.  You’re allowed to, you’re able to, you know, in a tablet mode, where it’s disconnected and it’s touch screen, or you can be in a real PC mode.  And it does both.  And you’re going to be able to get that at sub-$400  in just about all those OEMs you listed — Dell Inc. (NASDAQ:DELL), Hewlett-Packard Company (NYSE:HPQ), Lenovo, Acer, Asus, all of them. What you’re also seeing and what a lot of people especially in the U.S. don’t see is there’s a whole ecosystem building in Asia, especially in China where it’s coming out of a Shenzhen ecosystem and producing these low-priced tablets.”

On what he is going to do differently to show leadership in the mobile area:

“The part about mobile is pretty simple. You just have to focus the resources. We have the technologies, that silicon technology that we’ve been leading for years just has to be applied towards the mobile space now. So we’re moving forward and doing that, it takes a little time to get the products out the door and the customers signed up. The other thing on wearables we did was we announced today a new family of products called Quark and Quark is a small – it’s actually Intel’s smallest SoC that we’ve ever made. It’s about a fifth the size of our current smallest device, Atom, and uses about a tenth the power and it’s specifically designed for those wearables and industrial Internet of things.”

On whether he will continue to raise the dividend:

“Dividend and stock buyback are both key programs to us to bring value to our shareholders in other ways. As we generate cash, first priority is to push that back into the business, back into research and development, back into new products. Second after that is shareholder return so we look at both stock buyback and the dividend to give shareholders back some of that money.”

On whether they want to beat ARM:

“Sure, we’re here to win markets and get our parts into usable products but also I think what we’re really talking about here is we’re moving towards mobile and we’re moving our products in silicon and what we have that differentiates us is the silicon technology as well. All those you just talked about don’t own their own fabs, don’t have the silicon leadership that Intel has.”

On how their relationship with Hewlett-Packard will change if they jettison their personal computer business:

“I can’t predict what HP will do, but don’t forget we do a lot of business with them on servers and data centers and that’s actually a very large section of our business with them so no matter what Hewlett-Packard Company (NYSE:HPQ) will continue to be a great partner for us.”

On the number one message he wanted to get out during his keynote speech at the Intel Developer Forum:

The number one message is that movement, that rapid change, is actually an opportunity for us. Our leadership in technology really provides us an opportunity to lead. And any time there’s change, there’s a chance to move in there with new technologies, new capabilities.  And that’s what we’re really about.”

On whether he ever got sick of working for Intel:

“No, never. It’s all about technology. If you love technology, this is the place to be.”