Intel Financial Results Down for Q4 2012, is Windows 8 to Blame?

We continue to hear reports about lower holiday PC sales, lower yearly PC sales and doom and gloom regarding Windows 8 and RT adoption rates. Now Intel is reporting some less-than-optimistic news as well.

It seems that Intel’s fourth quarter 2012 sales were down compared with last year, bringing in $13.5 billion for the quarter, which is 3% less than last year. Its net income was $2.5 billion for the quarter, down a whole 27 percent when compared with the same period of time last year.

According to Paul Otellini, the current but almost-retired CEO of Intel, the results “played out largely as expected as we continued to execute through a challenging environment.” Intel also prediction that its 2013 revenue will only grow in single digits.

So what’s going on in the PC world? Its easy to say that Windows 8’s inability to reinvigorate the PC market is to blame, but really that’s kind of just an easy scapegoat. Windows 8 isn’t a runaway success, but nor is it a full-out failure.

Hopefully we truly see what Windows 8 is capable of in 2013. In the meantime, the other easy blame is that the PC world is dying, as so many proclaim. Is that true? Honestly, I don’t think that’s the case either.

Okay, so it’s not a dying PC market. It’s not Windows 8. What the heck is going on? It is actually just the way technology is heading combined with a less-than-stellar worldwide economic state. The PC is not dead or really dying, its just not in the same position for consumers as it was from about 1998-2010 or so.

Instead of being the most important (or ONLY) Internet access point at your home, it is a central family hub that is used for bigger screen Internet activity, reports and the like. For daily consumption and even often for gaming, most families are instead turning to high-end tablets and smartphones.

The end result is that a PC does not need to be upgraded every 2-3 years. There are many families that find that a Windows 7 machine rocking an older Core 2 Duo or Quad is more than enough. For these individuals, 3-6 year old PCs are proving more then good enough.

This doesn’t mean the PC market is dead, it just isn’t in a state of constant change like it was at one point. People still want and need PCs for ocassional productivity purposes, they just don’t need them as a gateway to the “fun stuff” on the net, thanks to the existence of other devices that fill that gap (tablets, phones, media centers, game systems, etc).

The solution for Intel and Microsoft? That’s a much harder question to answer. If Windows 8 can eventually convince consumers that they need touch-screen big-display PCs that run on Windows 8 and act as powerful family entertainment hubs, some consumers might start buying again.

For now though, Windows 7 and older Intel processors are a combo that seems to work just fine both for productivity and entertainment.

What do you think, do you agree that people just don’t need to upgrade their machines as often thanks to supplemental devices like smartphones and tablets, or is there an even deeper reason?

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  1. Jason Albright

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