Intel's Rise in the AI Inference Market
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 11 hours ago
0mins
Should l Buy INTC?
Source: Fool
- Inference Workload Growth: Deloitte estimates that by 2026, inference workloads will account for two-thirds of all AI computing power, up from 50% last year, significantly increasing demand for specialized AI chips, particularly benefiting Intel's market outlook.
- ASIC Market Demand: Application-specific integrated circuits (ASICs) are favored by hyperscalers and AI companies for their efficiency and cost advantages, with Broadcom forecasting AI chip revenue to exceed $100 billion by 2027, a substantial increase from last year's $20 billion.
- Intel's Market Share: Intel holds over 71% of the server CPU market, and its ASIC revenue nearly doubled year-over-year in Q1, indicating strong growth potential in the AI inference chip market, with an annual run rate exceeding $1 billion.
- Future Growth Expectations: Market research firm Futurum projects the CPU market in AI data centers to grow at an annualized rate of 28%, with Intel's enhanced manufacturing capacity and partnerships in the AI chip space likely driving growth beyond expectations, potentially elevating its market cap to $710 billion by 2028.
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Analyst Views on INTC
Wall Street analysts forecast INTC stock price to fall
29 Analyst Rating
5 Buy
19 Hold
5 Sell
Hold
Current: 113.010
Low
20.00
Averages
39.30
High
52.00
Current: 113.010
Low
20.00
Averages
39.30
High
52.00
About INTC
Intel Corporation is a global designer and manufacturer of semiconductor products. The Company's segments include Intel Products, Intel Foundry, and All Other. Its Intel Products comprise Client Computing Group (CCG) and Data Center and AI (DCAI). CCG delivers platforms and processors that power PCs and edge devices, enabling enhanced performance, connectivity and user experience for consumer and commercial markets with capabilities that also support retail, industrial robotics and AI ecosystems at the edge. DCAI delivers workload-optimized solutions based upon its x86 architecture for data centers, including CPUs, AI accelerators, NICs, IPUs and custom ASICs, enabling performance and scalability for cloud, enterprise, telecommunication and HPC environments. The Intel Foundry segment comprises technology development, manufacturing and foundry services, developing new semiconductor process technologies and advanced packaging technologies. All Other segments include Mobileye and Other.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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See More
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- Supply Chain Risks: During the earnings call, Arm highlighted potential supply chain risks for its newly launched AGI CPU chip, which, despite being in a high-demand market, triggered an 8.8% drop in stock price post-earnings release due to uncertainty.
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- Technological Innovation: The company utilizes standard silicon chip manufacturing techniques to convert traditional transistors into high-quality qubits by manipulating the spin of a single electron, showcasing its unique and practical approach to quantum computing.
- Cost Efficiency: Quantum Motion anticipates that its quantum computers could be produced for as little as $10 million to $20 million, providing a competitive edge in the market and potentially accelerating the commercialization of quantum computing.
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