MN7031 Global Strategy and Innovation

Case Study 2 – Macro-Environment Analysis

Student ID:
Word Count – Excluding Appendices, Diagrams and Tables: 597
1. Introduction
Intel Corporation (Intel) is a digital technology company that designs and develops products
and components. It is world’s largest semiconductor chip manufacturing brand in terms of
revenue. Intel has revenue of 77.87 billion dollars and is steadily increasing. Notebooks,
tablets, servers, and desktops all use the company's products. Intel's revenue for the year
ended March 31, 2022 was $77.704 billion, down 0.01 percent year over year. Intel's 2021
yearly sales are up by 1.49 percent from the previous year i.e. $79.024 billion dollars. As of
August 2021, Intel's market capitalization is $213 billion, compared to AMD's (Advanced
Micro Drivers) market cap of $127 billion (Yahoo Finance, 2021). AMD is the current and
the only competitor of Intel.
2. Key Current and Future External Changes Faced by Intel
Intel's revenue for the quarter ended March 31, 2022 was $18.353 billion, down 6.71
percent year over year. The reason in the back of the steep decline is the global
semiconductor shortage that commenced in the year 2020 due to the surprising expand in
the demand of semiconductor chips that are used to run home equipment such as
Televisions, Tablets, Laptops, and other electronic devices. Due to the epidemic, there was
once additionally a substantial surge in laptop sale as everything shifted to work from home.
Sales have multiplied as an end result of work from home and on-line education. The global
microprocessor market is expected to grow at a compound annual growth rate of 4.1% from
2019 to 2027 to reach USD 112.8 billion by 2027. But in the near future, the semiconductor
industry will face the challenges and opportunities of growing product demand. The
semiconductor supply chain will be stressed as artificial intelligence (AI) and the Internet of
Things (IoT) expand in popularity, as well as continuous demands from the smartphone
industry and other high-tech businesses. The problem will be exacerbated by ongoing
international trade tensions, which might drive up the cost of semiconductor materials and
stymie global industry collaboration. After the production and usage these semiconductor
chips also accounts for the rise of e-waste. So, a rigorous requirement or law must be
enacted or else the sales of enterprises in this sector may suffer. As a result, Intel must be
prepared in advance of any external issue that could stymie the company's growth.
3. Intel – Opportunities and Threats
A company analyses two external factors i.e. Opportunities and Threats

Opportunities:
 The COVID-19 pandemic has opened the gates for IT and Technology based
industries and it can be witnessed in the rising sales of Laptops and Tablets.
 Drones are rising in popularity and are poised to become the future of logistics and
surveillance. Intel can work on drone processors.
 Automatic Vehicles: Another industry that demands processors and hence poses a
significant possibility for Intel.
  The corporation may, for example, develop semiconductor products to target new
areas of the home appliance industry. Diversifying the business through acquisitions
is another option.
 Intel offers new and advanced processor types more regularly, causing users to
upgrade to the most recent model, resulting in increased sales.
 “Intel Unleashed: Engineering the Future” webcast. “IDM 2.0,” a major evolution of
Intel’s integrated device manufacturing (IDM) model.
Threats:
 Intel concentrates their efforts solely on one product. It will be a major loss for Intel
if another firm launches a superior version of the existing product that Intel sells.
 Companies such as AMD, Dell, and IBM are competitors. Intel must keep pace with
these companies in terms of pricing, quality, and technology.
 Many competitors strive to attract Intel customers by offering lower-cost items. A
market that is price sensitive will be attracted to significantly lower prices.
 People are becoming more conscious of environmental issues, and a trend of
choosing Carbon Neutral companies over others is gaining traction.
References
 Aditya Shastri (2022). Comprehensive S.W.O.T. Analysis of Intel. https://iide.co/case-
studies/swot-analysis-of-intel/#SWOT_Analysis_of_Intel
 MacroTrends (2022). Intel Revenue 2010-2022, INTC.
 Ferguson (2017). Intel Corporation’s SWOT Analysis & Recommendations.
 IEEE.org (2020). https://irds.ieee.org/topics/new-challenges-facing-semiconductors
 Intel (2021). “Intel CEO Announces ‘IDM 2.0’ Strategy for Manufacturing,
Innovation,...” www.intel.com/content/www/us/en/newsroom/news/idm-
manufacturing-innovation-product-leadership.html.
 PESTEL Analysis:

Political Economic Social

• Improving
• Developing markets
wealth
are experiencing
• Government- distribution
OPPORTUNITIE rapid expansion.
assisted intellectual • Developing
S • Obtaining the
property protection energy efficient
solidity of established
items to have a
markets
social impact
• Increased
competition as a • Decrease in sales
• Social customs
result of due to global
THREATS • Ecological
globalisation shortage of
perception
• Market share semiconductors
dilution

Technological Environment Legal

• Entering the
growing
• Focusing on
smartphone
• Increasing Intel's consumer
OPPORTUNITIE industry
environmental protection
S • Better R&D
strategy • Improving
releases better
patent laws
versions of products
on a regular basis

• Smartphone • People do not • Disposal

processor that prioritize companies regulations
THREATS enables businesses that have a negative • Inappropriate
to enter the desktop impact on the intellectual
/ laptop market environment property law