Intel Corporation (NASDAQ:INTC) unveiled its latest processor, the Silvermont architecture Atom yesterday. A new report on the processor, from RBC capital markets, suggests that although the chip is good, the market is likely to remain skeptical of Intel’s chances to break into the low power processor market until it shows some real results.
Intel Corporation (NASDAQ:INTC) has been trying to get its processors into the mainstream mobile market ever since Apple Inc. (NASDAQ:AAPL) declined the company’s offerings when manufacturing the original iPhone. The firm, which has for years specialized in beating its competitors on power alone, has been unable to provide chips with the right balance of power consumption and processing clout.
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The new Atom has been designed to finally beat the problems the company has had in this area. The processor utilizes the company’s 22nm architecture, and will come in four flavors: Bay Trail: A quad-core chipset for tablets that will be come out in time for Q4; Avoton: A chip for microservers, to be available some time in 2013; Rangeley: A chip for routers and other small devices; and Merrifield which is the firm’s low power smart phone offering, due in 2014.
Intel Corporation (NASDAQ:INTC) also made it clear in yesterday’s press conference that it plans to refresh its line up of Atom chips every year. The RBC Capital report identifies the problem for investors with Intel Corporation (NASDAQ:INTC) is its mobile offerings—every year is supposed to be the year the company sees success in the market, but it hasn’t happened yet.
That means investors are likely to wait and see how manufacturers approach the Silvermont architecture before they buy into the company’s mobile philosophy. Intel Corporation (NASDAQ:INTC) has not managed to get into the market yet, and though these chips are certainly better than ever, the same was true last year.
That means that the market is going to take a wait and see approach. The RBC Capital market analysts concur. Intel gets a price target of $29 from the company, but it’s based on the firm’s reliable business rather than new mobile offerings.
On today’s market Intel Corporation (NASDAQ:INTC) shares were performing well. The company’s stock was up 1 percent at time of writing and sat at a price of $24.15 per share. So far in 2013, Intel shares have increased by just over 17 percent as investors get behind the company’s attempts to break into the mobile market and continue dominance in PC chips.