Intel Rolls Out Limited AI Chips for China, Gains Despite Market Slump

Intel will release two AI processors with limited capabilities for the Chinese market to comply with US export limits and sanctions.

Intel and Nvidia Adapt to U.S. Export Laws, Release Modified AI Chips for China Market

According to a white paper published on the company's website on April 12 (via Reuters), the two chips, HL-328 and HL-388, will be available in June and September, respectively. The tech outlet The Register first published the white paper's plans.

Rival Nvidia also plans to release three China-specific chips after the US tightened a law limiting the capabilities of AI processors that can be shipped to China late last year.

Intel's China-specific AI chips are based on the company's most recent Gaudi 3 product line, announced on April 9, and share hardware capabilities such as on-chip memory, high-bandwidth memory, and interface standards.

However, the chip's performance will be severely lowered to meet export control regulations.

Reuters reported in January that one of Nvidia's China-specific chips, the H20, will be delivered in small batches in the first quarter of 2024, with bigger amounts expected in the second quarter.

Intel Outperforms Market Averages as Investors Anticipate Strong Earnings Growth

Intel (INTC) closed the latest trading session at $36.31, up 1.74% from the previous day's closing price. The stock outperformed the S&P 500's daily loss of 1.2%. The Dow fell 0.65%, while the tech-heavy Nasdaq dropped 1.79%.

The stock of the world's largest chipmaker has dropped 16.3% in the last month, trailing the Computer and Technology sector's loss of 0.51% and the S&P 500's loss of 0.85%.

The investment world will eagerly watch Intel's success in its upcoming earnings release. The corporation plans to report its earnings on April 25, 2024. On that day, Intel is projected to report earnings of $0.13 per share, representing 425% year-over-year growth. Meanwhile, our most recent consensus forecast is for sales of $12.76 billion, up 8.93% from the prior year.

The Zacks Consensus Estimates for the entire fiscal year estimate earnings of $1.30 per share and revenue of $57.77 billion, respectively, increasing by +23.81% and +6.53% over the previous year.

Investors should also take note of any recent changes to Intel's analyst estimates. These modifications often reflect the most recent short-term business trends, which can change rapidly. Positive revisions to projections reflect analysts' confidence in the company's business performance and earnings prospects.

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