Intel, the world’s largest chipmaker, has seen increased demand in recent weeks stemming from COVID-19 and work and schooling from home.
Demand is up for PC chips but also server chips for hyperscale systems that help people stay connected.
The company has kept 90% of its global fabrication capacity up and running as well as on-time delivery during the first quarter, CEO Bob Swan said in a Thursday interview with Bloomberg Television.
“We’ve seen demand relatively strong during the first quarter,” Swan said. “It’s somewhat logical and intuitive. Where our lives are disrupted, we need to do more and more things from home, and we need to ensure we have the technology at our disposal so things can go on as normal as possible.”
Swan also said Intel’s global supply chain has worked well in part because fab workers in China in January worked through the Chinese New Year and didn’t need to go home. “We were able to keep capacity up and running as the [COVID-19] challenge went around the world,” he said.
Intel has forecast $19 billion in revenue for the first quarter and will report earnings on April 23. The company has 110,000 employees and finished 2019 with revenues topping $71 billion.
Part of Intel’s job with COVID-19 is to convince various governments where Intel operates to consider chipmaking an “essential” business that is exempt from disclosures. The Semiconductor Industry Association has lobbied governments to keep all semi industry operations as “essential infrastructure” arguing that chips are part of the supply chain of essential goods, from PCs to servers used broadly.
Another semi maker, Micron, reported a strong fiscal quarter ending Feb. 27 with $4.8 billion in revenue. Micron expects data center demand for its products to be strong in its third quarter along with a recent increase in demand for notebook computers.
However, some companies are withdrawing their outlook statements based on supply chain disruptions and uncertainty about future demand, including Analog Devices.
Another sign of the unsettling nature of COVID-19 on semiconductor makers comes from analysts. Analyst firm Gartner on Thursday said overall semi revenues will drop globally 1% in 2020 because of the impact of COVID-19 on demand. IDC had a projection earlier that was even worse, with a 6% decline expected for the year.