Intel’s GPU Growing Pains

Gamers had high hopes for Intel’s return to the discrete graphics card market, even if everyone knew it wouldn’t be easy. But with Intel’s latest financials and reports of significant product flaws, the company may soon have tough decisions to make.

The Writing on the Wall
Intel is finding its first video card launch in decades to be quite the ordeal, with its recent financials not offering any solace.

  • $507 million loss for Accelerated Computing System and Graphics Group
  • Only 5% revenue growth YoY
  • Intel will miss its shipment goals

More concerning than these numbers is the talk swirling around Intel’s Arc graphics cards – and whether or not they even have a future. “We thought that we would be able to leverage the integrated graphics software stack, and it was wholly inadequate for the performance levels, gaming compatibility, etc. that we needed,” admitted Intel CEO Pat Gelsinger.

Reports are also starting to surface that Intel’s board partners are unhappy and may back out.

  • Intel’s launch focus on OEMs and system integrators, as opposed to consumers, means lower margins for board partners
  • Hardware and software issues could be the last straw for partners in need of inventory space for upcoming Nvidia & AMD launches

How Committed is Intel?
That’s the big question here. It missed the COVID-era seller’s market and is launching during an economic slowdown. To the company’s credit, it has done some damage control: pivoting to marketing its video cards as non-gaming products and openly communicating some of the challenges. But disgruntled board partners is a  bad sign, and if the bleeding doesn’t stop, it will not be surprising if Intel completely pulls the plug on its video card plans.