Intel's faltering GPU launch has only made matters worse as it reports rare loss
Intel's Accelerated Computing Systems and Graphics Group (AXG), which is responsible for its line-up of Alchemist graphics cards, has lost the company $507 million in the past three months. That is markedly more than it lost in Q1, 2021 which came in at $168 million.
A big chunk of that cash is caught up in «inventory reserves and roadmap investments», Intel explains. Alchemist is yet to hit the shelves anywhere outside of China, and may be further delayed according to recent leaks from YouTuber Moore's Law Is Dead(opens in new tab), yet inventory is building up ready for a release at some point.
Now that sort of build-up of inventory is to be expected for a major product launch, but it has coincided with one of Intel's worst financial reports in years. The company posted revenue of $15.3B(opens in new tab), which is down 17% year on year and $2.7B below the expected outlook.
Alchemist wouldn't have done much to plug that hole, but a timely release may have gone a long way to making Intel's big push into graphics appear a lot more worthwhile for shareholders.
«The sudden and rapid decline in economic activity was the largest driver of the shortfall, but Q2 also reflected our own execution issues in areas like product design, DCAI, and the ramp of AXG offerings,» CEO Pat Gelsinger says (via Seeking Alpha(opens in new tab)).
Intel is having to lower its expectations for AXG, stating that it will «not hit our GPU unit target.»
He also elaborates slightly on why Intel hasn't been able to deliver Alchemist in a timely fashion, noting «COVID-related supply chain issues and our own software-readiness challenges caused availability delays that we continue to work to overcome.»
There is some positive news, however, and it's not
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