Is Intel's Turnaround Story Fake?

Almost all the PC stocks have struggled in 2016 as Intel’s (INTC) weak earnings report painted a grim picture of the industry’s outlook. Stocks in the segment are constantly looking to diversify their business to counter the falling demand for PC. Intel is no exception to this trend as the company has diversified, albeit unsuccessfully, to many other segments. Although Intel is struggling right now, the company is making a few good moves that could change its fortunes in the future.

A Smart Move

Intel and Qualcomm (QCOM) are well known for smartphone chip manufacturing rivalry.
But 2015 was an awful year for both the companies as they were down 14 percent and 35 percent, respectively. After being in red previous year, 2016 is off to a terrible start too, as both the stocks are down 16 percent and 10 percent. Given the volatility in the market, investors are finding it difficult to invest in good companies. However, after the recent plunge, I think Intel may be closing in on a bottom.

According to latest reports, Intel and Qualcomm have decided to work in partnership with each other to expand their horizon in Wireless Gigabit Alliance, a developing wireless communication technology. WiGig proposes quicker Wi-Fi connectivity, and the company believes that WiGig will introduce multi-gigabit speed wireless connectivity into the market.

Intel’s main purpose is to offer customers wireless computing experience. The idea is building a common platform where multi-vendor devices can be docked, which will give rise to the demand for the company’s processor that support docking. If Intel successfully launches wireless computing, then it will be the first move in the direction of building the ecosystem.

Intel’s advanced wireless docking technique uses WiGig connectivity by means of tri-band wireless-AC 17265 card which aids 60GHz WiGig 802.11ad connectivity. The company also aims to help customers to shift from power adapters grounded on Rezence magnetic resonance technology. Alliance 4 Wireless Power will be used in place of wired power adapters, which is again beneficial for Intel. The wireless docking technology support tablets, laptops, and 2-in-1s powered by Intel’s Skylake processor.

Recently, Qualcomm is has also started focusing on manufacturing its own WiGig-supported products. Qualcomm is strategizing to control the power of its Snapdragon 820 and Qualcomm Atheros’ IPQ 8064 reference design tied with QCA9500 802.11ad chipset.

The main purpose behind this deal is to overcome the restrictions so that WiGig-supported devices, like tablets, VR headsets, laptops, smartphones, AR glasses etc. can efficiently use the new standard by means of cross-platform compatibility among the both companies’ WiGig offerings. Ultimately full interoperability will certify improved demand and stable market share for their processors.


With the stock market off to a terrible start, I think investors can find many long-term opportunities. Intel’s shares have remained depressed over the last few years as the company has struggled to cope with the falling demand for PC. However, I think the stock may have bottomed and possess significant upside potential from current levels.
Published on Feb 18, 2016
By Akshansh Gandhi

Copyrighted 2020. Content published with author's permission.

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