Intel (INTC)

Being the largest player in the chip market, Intel is bound to run into anti-trust issues. Recently the European Commission found the company guilty of anti-trust abuse on May 15th 2009 and fined the company over $1.4 billion. Intel has filed an appeal to this fine, but with Japan and Korea also following suit with anti-trust violation rulings, Intel has a long road ahead of clearing its name and reputation.

http://www.computerworld.com/s/article/9135793/Intel_files_appeal_against_European_antitrust_fine?taxonomyId=12

The projects just got lower, and lower, and lower. From 10.1-10.9 billion, to 8.7-9.3 billion, and now with the world's largest chipmaker saying that their 4Q revenue was a mere 8.2 billion, down 23% from the latest projections. The cause? Sluggish PC growth has PC makers burning through their current chip inventories rather than buying more.

http://www.usatoday.com/money/companies/earnings/2009-01-07-intel-warns_N.htm?csp=34

The pricing war that began with AMD is not over. Despite cooling from a heated battle in 2006 and part of 2007, margins still suffer from competition. Intel's performance in the 90s was strongly related to the lack of competition it faced. Since AMD released its K6 processors in the late 90s, Intel has had pressure applied to its market share.

Intel is currently the leader in performance for microprocessors, but because of AMD recent history of successful R&D, this leadership is subject to Intel's own continued successful R&D efforts. Until the Core design, Intel slipped in relative performance and was bleeding market share. With AMD's ambitious Fusion platform (2009) in development, Intel's Nehalem project (2008) must be a success in order to maintain that performance lead.

Growth in demand for computers has slipped since the mid-1990s. If this trend continues Intel could see decreasing growth in revenues.

Due to the significant fixed costs in the industry and the somewhat volatile demand for their products (due to product cycles and general market swings) Intel may see periods, in both the short- and long-run, of significant revenue decreases. This may result from quick changes in the market demand and the difficulty that comes with reducing fixed costs in the short-run.

As the products produced by Intel and AMD become increasingly similar in technology and design, Intel may see a decreasing margins over their competitor.

"In the newest MacBooks, Nvidia not only seized graphics turf from Intel, but it also took the chipset socket. Intel was relegated to supplying only the processor. That's analogous to Nvidia snagging a piece of prime Manhattan real estate right from under Intel's nose. While Intel holds on to Times Square, Nvidia walks off with Rockefeller Center."

With the rise of netbooks, can NVIDIA take more ground away from rival Intel?

http://news.cnet.com/8301-13924_3-10127699-64.html?part=rss&subj=news&tag=2547-1001_3-0-5