Intel corporation (NASDAQ:INTC) came under the leadership of Brian Krzanich 16 months ago when he was appointed as the CEO. Since then, the company has been doing exceptionally well, and the stock has seen a surge of 44%, according to a report from Bloomberg. Mobile internet usage has gone up drastically, and the company has benefited from this.
Best performer on Dow this year
So far this year, Intel has been the best performer on the Dow Jones Industrial avaerage, well ahead of the number two Microsoft Corporation (NASDAQ:MSFT) by over 8 percentage points.
Intel’s division that makes chips for servers, the data-center computers that power Internet search, commerce and social media has made a major contribution to the firm’s rise on the Dow Jones Industrial average. The division has already acquired a 98% share of the server chip market under the leadership of Krzanich. Intel has made many smart moves to retain its position, and new entrants that could become rivals in the future have been diverted to operate in new markets. It even redesigned its chips to meet the requirements of its big clients. The firm took special care of the competitive threats by creating a separate team comprising hundreds of employees.
Even though the computing market has been taken over by mobile devices and cloud services, Intel Corporation’s strength in servers has helped the company to sustain investors’ faith.
Mobile market next challenge for Intel
The next challenge for the company’s CEO is to cater to the needs of the smartphone chip customers, and trying to make it an equally big success as the server division.
“If you want to know what the new Intel looks like, one place to look is at Intel’s data-center group,” said President Renee James, Krzanich’s second-in-command. “Our vision is that if it computes, it does it best with Intel inside, and our success in the data center is a leading indicator.”
Intel Corporation’s grasp in servers is being targeted by the ARM-based processors, which have limited the former’s entry into the phone market. More generic Intel products are criticized by companies such as Applied Micro Circuits Corp (AMCC) and AMD on the grounds that they offer cheaper designs that consume less power and have the capability of combining multiple functions servers better than by generic Intel products.