Intel, the giant chipmaker, plans to introduce new entry-level PC processors in the second and third quarters of fiscal 2016, according to a recent report from Digitimes. It’s a bold decision from Intel considering the prevalent weakness in the PC market.

Intel To Launch New Entry-Level PC Chips By 2016 [REPORT]

Compensating for weak PC demand

PC demand has been really weak, and this has affected the chip  maker’s shares severely. Since the beginning of fiscal 2015, Intel’s shares have been on a downward trend. In late August, the stock hit a 52-week low of $24.87.

Intel needs to explore new sources of revenue to compensate for the downturn in the PC market. In its efforts to diversify, the chip maker acquired Altera, a maker of programmable chips. Intel has also made strides in manufacturing memory chips. It launched Micron Technology and 3D Xpoint Technology side by side. Wall Street is bullish on Intel as Intel’s upcoming 3D Xpoint technology is seen as revolutionary.

Though demand for PCs is soft, demand for mini PCs and gaming notebooks has remained strong, especially for those that run on Intel’s entry-level processors. Intel plans to gain from the PC market by launching inexpensive and mini PCs that run on entry-level processors which are much like Pentium and Celeron.

Intel is expected roll out its Apollo Lake processors in the second half of fiscal 2016, and in the next two months, it will also roll out several entry-level PC offerings.

Intel restoring investors’ confidence

On its annual analysts’ day, the chip maker presented healthy reports which were like an award for the company’s shareholders. Intel announced a hike in quarterly cash dividends and also raised its full-year 2016 outlook. Intel also revealed plans to invest more than $5.5 billion on the conversion of its old factory in China for manufacturing its 3D NAND technology. All these announcements helped in restoring investor confidence.

Of the 31 Wall Street analysts covering Intel, 18 consider it a Strong Buy, two rate it a Buy, eight see it as a Hold, one rate it as a Sell, and two consider it a Strong Sell. The stock has a consensus price target of $36.69.

On Tuesday, Intel stock closed up 0.92% at $35.09. Year to date, the stock is down by over 3%, while in the last one month, it is up by almost 4%.