Intel Might Be Paying The Price For Its Own Actions, But There Is Hope Says Bernstein

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According to Bernstein, Intel's PC CPU shipments grew in the second quarter, which is a rare good news for the firm after its bloodbath second quarter results earlier this month. These shipments came when the PC market grew sequentially and exceeded pre-coronavirus demand. Intel and AMD's PC market, which the pair dominate, grew by 9% over Q1, according to analyst Stacy Rasgon. This growth follows a 1% annual growth in Q1, but Intel's woes aren't over, as, according to the analyst, PC shipments continue to lead CPU shipments.

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Bernstein's data shows that the PC market outpaced typical seasonal performance in Q2, growing by 9% over the previous quarter and 1% annually. Crucially, the annual growth figure of 1% was a two-percentage-point gain over the 1% drop in Q1 and a three-point gain over Q4 2023's 2% contraction.

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Intel and its smaller rival AMD rely on their sales channels to clear inventory. This also leaves them vulnerable to supply chain disruption, as a demand and supply mismatch can lead to excess or low inventory in the channel. This leads to either a glut or a shortage, with the end prices dropping or rising correspondingly.

According to Bernstein, the personal computing central processing unit (PC CPU) channel for desktops and notebooks appears to be clearing. This channel has been 'overstuffed' in recent years, and Intel, for its part, has often faced accusations of shipping too much product to maintain shelf space even if the supply exceeds demand.

The data reveals that during Q2, desktop and notebook CPU shipments outpaced end product shipments by 9%. This margin was higher for notebook CPUs, as it sat at 10%, and the