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Intel had its best year ever in 2021, despite chip shortage

Intel has announced its fourth-quarter earnings report for 2021, confirming that despite a chip shortage and supply constraints, Team Blue experienced its best financial year ever.

Revenue during the fourth quarter totaled $19.5 billion, which represents Intel’s highest financial quarter in the company’s history and a year-over-year increase of 4%. It also exceeded analysts’ expectations of $18.3 billion.

A chart detailing Intel's full financial results for 2021.
Image used with permission by copyright holder

Total revenue for the full financial year of 2021 reached $74.7 billion. That marks the highest earnings amount in a full year for the chip giant. Profits, however, have decreased. For the fourth quarter, net income dropped 21% to $4.6 billion, while overall net income for 2021 was also down 5% compared to 2020 at $19.9 billion.

One contributing factor behind the reduction in profits is the performance of Intel’s laptop division. As reported by The Verge, revenue for this specific segment is down 16% year-over-year largely due to the shortages in the components and silicon required to build these systems. That said, according to Intel, it generated more revenue for each laptop sold thanks to the average selling price of such components increasing by 14%.

“Shortages in substrates, components and foundry silicon has limited our customers’ ability to ship and finish systems across the industry,” said Intel CEO Pat Gelsinger. “This was most acutely felt in the client market, particularly in notebooks, but constraints have widely impacted other markets, including automotive, the internet of things, and the data center.”

Intel’s desktop sales, meanwhile, increased by 7% during the fourth quarter compared to the same quarter in 2020. Elsewhere, as pointed out by Tom’s Hardware, Intel shipped over 30 million premium Tiger Lake CPUs for notebooks during this period. Its data center group also experienced growth of 20% year-over-year to $7.3 billion.

Looking ahead, 2022 will be an interesting year for Intel in terms of earnings potential. The company’s 12th-generation Alder Lake processors are off to a great start by becoming some of the best CPUs on the market, with the firm also set to launch its Arc Alchemist lineup of graphics cards for both desktops and laptops.

With the possibility of introducing sub-$200 GPUs amid a worldwide shortage and rising prices, its upcoming video cards may contribute to another record financial year for Intel. The company is also investing $20 billion into new fabrication plants, strengthening its ability to produce more semiconductors.

Intel’s future earnings may also be boosted by its Bitcoin mining chip, which has already secured its first major customer.

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Zak Islam
Computing Writer
Zak Islam was a freelance writer at Digital Trends covering the latest news in the technology world, particularly the…
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