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Intel Data Center Business Growing as PCs Slow

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Intel reported its full year fiscal 2012 earnings late Thursday, showing particular strength in the data center business.

For the year, Intel’s revenue was reported at $53.3 billion with Net Income of $11.0 billion. The lion’s share of Intel 2012 revenue came from its PC Client Group, with $34.3 billion, a 3 percent year-over-year decline. In contrast, the Data Center Group grew by 6 percent, with 2012 revenue of $10.7 billion.

“Worldwide GDP growth was significantly less than we had thought entering the year and the PC market segment with impacted by the growth of tablets,” Intel CFO, Stacy Smith said during the company’s earnings call.

Smith noted that the data center group grew thanks in part to a richer mix of products that Intel made available in 2012.

“The Data Center Group saw a comprehensive refresh across its product line last year,” Intel CEO Paul Otellini said during his company’s earnings call. “Romley locked the Sandy Bridge architecture to servers for the first time.”

The Romley architecture, also known as the Xeon E5 was announced, in March of 2012. The E5 provides improved raw compute power as well as security and I/O innovations.

Intel also pushed forward with its low power and high-performance computing server architectures in 2012, with the launch of the Knights Corner and Centerton processors.

“Knights Corner or Xeon Phi brings 60 cores in the familiar Intel architecture programming model to supercomputing applications,” Otellini said. “At six watts, Centerton is the industry’s only low power microserver SoC that delivers critical enterprise features like 64-bit, ECC and virtualization.”

2013 Pipeline

Looking out into 2013, Otellini is optimistic about his company’s pipeline of new PC and data center products. Among the new PC products on Intel’s 2013 roadmap is the Haswell architecture.

“Haswell was designed from the ground up to enable breakthrough innovation in form factor, battery life and usability,” Otellini said. “It will deliver the single largest generation-to-generation battery life improvement in Intel’s history and it is inspiring a new wave of ultra-sleek, convertible, touch-based designs across our customer base.”

On the data center side, Intel plans on shipping 22 nanometer versions of its Atom products for the data center in an effort to deliver additional performance and low-power capabilities.

Custom Fabrication

For most of its history, Intel has designed and built microprocessors under its own name using its own designs. That is likely to change in 2013 as Intel expands to become a custom foundry manufacturer.

“We don’t see ourselves as a general purpose foundry or competing with the general purpose foundries,” Otellini said. “The kinds of things we would do, we would not take business that would enable a competitor. We would certainly consider business that would enable and strengthen relationships with strategic partners.”

Sean Michael Kerner is a senior editor at, the news service of the IT Business Edge Network, the network for technology professionals Follow him on Twitter @TechJournalist.

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