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Intel reportedly planning to unleash its financial might to counter AMD, price cuts for Core and Xeon processors to cost US$3 billion

Intel is reportedly planning to offer discounts to counter AMD's rising market share. (Source: Fstoppers)
Intel is reportedly planning to offer discounts to counter AMD's rising market share. (Source: Fstoppers)
A leaked internal Intel slide courtesy of AdoredTV talks about Intel's plans to counter AMD's increasing marketshare via price cuts that would cost the company around US$3 billion. Intel hopes that these price cuts would help its Core and Xeon offerings remain competitive, but AMD still has the advantage when it comes to leveraging TSMC's increased yields and margins for the Ryzen chips.
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AMD has managed to wrestle-back significant market share from Intel thanks to the Ryzen and Threadripper processors that offer a higher performance per dollar compared to Intel's offerings. Not just with these CPUs, but Intel is facing stiff competition from the EPYC server lineup as well. Recently, Intel had internally discussed about AMD's "competitive profile" and is apparently looking at plans to thwart the latter's moves by showing its financial might — even if it turns out to be a bit costly.

Recently, an internal Intel document called "AMD Competitive Profile" leaked on Reddit, which detailed why AMD's offerings are successful and how Intel stacks up to them. Now, AdoredTV showed off what is likely to be an internal Intel sales slide that reads, "Intel's Scale Advantage... Financial Horespower". Before we go on, do note that the authenticity of the slide cannot be verified and there's literally no way of confirming this with Intel either. So, do take it with a grain of salt. 

The slide indicates that Intel's size and scale is still much higher than that of AMD's. So high that if Intel plans to offer discounts and other incentives for the current and upcoming Core and Xeon processors, it would have to cough up around US$3 billion in 2019 — 10x the figure that AMD had netted as income (US$0.3 billion) in 2018. This US$3 billion price that Intel is apparently willing to part with is being billed as a "2019 Meet Comp Discount".

US$3 billion shouldn't be too much of a worry for Intel, especially if it helps the company to remain competitive. We've already seen industry sources talking about Intel planning to cut prices for the 9th generation Core processors. Assuming that this is indeed Intel's strategy, it only serves to indicate that the Santa Clara-giant is trying to regain lost ground at least in terms of pricing if not in terms of performance. 

Thanks to some lofty ambitions that did not quite pan out as intended, Intel got delayed in its 10nm sojourn while AMD is en route to 7nm+ with Zen 3, with TSMC's capabilities playing to its advantage. Therefore, even if Intel offers decent price cuts, AMD can still hit back with even more aggressive pricing given the higher yields of Ryzen chips.

Would you prefer a lower-cost Intel 9th gen processor over AMD Ryzen 3rd gen? Let us know in the comments below.

Intel may set aside US$3 billion as part of the "2019 Meet Comp Discount" initiative. (Source: AdoredTV on YouTube)
Intel may set aside US$3 billion as part of the "2019 Meet Comp Discount" initiative. (Source: AdoredTV on YouTube)
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Vaidyanathan Subramaniam
Vaidyanathan Subramaniam - Managing Editor - 1358 articles published on Notebookcheck since 2012
Though a cell and molecular biologist by training, I have been drawn towards computers from a very young age ever since I got my first PC in 1998. My passion for technology grew quite exponentially with the times, and it has been an incredible experience from being a much solicited source for tech advice and troubleshooting among family and friends to joining Notebookcheck in 2017 as a professional tech journalist. Now, I am a Lead Editor at Notebookcheck covering news and reviews encompassing a wide gamut of the technology landscape for Indian and global audiences. When I am not hunting for the next big story or taking complex measurements for reviews, you can find me unwinding to a nice read, listening to some soulful music, or trying out a new game.
contact me via: @Geeky_Vaidy
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> Notebook / Laptop Reviews and News > News > News Archive > Newsarchive 2019 10 > Intel reportedly planning to unleash its financial might to counter AMD, price cuts for Core and Xeon processors to cost US$3 billion
Vaidyanathan Subramaniam, 2019-10-14 (Update: 2019-10-14)