Intel to expand contract manufacturing business

Intel's new chief executive officer Brian Krzanich has predicted that the company will maintain its dominance over the rest of the chip industry, as he announced plans to expand the small contract manufacturing business.

Speaking yesterday at Intel's annual investor day, Krzanich said that the company aims to catch up with rivals in the production of chips for mobile devices like smartphones and tablets. Currently, Intel rely on the personal computer market for the bulk of its business, however this market has been in decline for the past two years.

"We're going to go much further," Krzanich said. "If we can utilize our silicon to provide the best computing, we'll do that. People who can use our leading edge and build computing capabilities that are better than anyone else's; those are good candidates for our foundry service."

At his first major presentation to investors, Krzanich made no forecasts of increased revenue but did predict that the PC market would steady: "Our view is that it's declining but it's beginning to show signs of stabilization."

Krzanich first announced Intel's intentions to focus on mobile devices back in September at the Intel Developer Forum (IDF). It was there that he first revealed plans for what he calls the world's first 22nm phone, capable of supporting LTE data transfer, in a speech titled "mobilizing Intel".

In his latest presentation, Krzanich's prediction for no increase in revenue for Intel in the next year left some analysts questioning where growth would come from. Despite this, Intel's share value increased by 2.5 per cent by the end of trading yesterday.