7 Oct

Intel-AMD Price War Begins with Cascade Lake-X Launch

WRITTEN BY Puja Tayal

Today, Intel (INTC) launched its Xeon W workstation processors and X-series HEDT (high-end desktop) processors with a new price structure. This launch comes just days after Advanced Micro Devices’ (AMD) Ryzen Pro 3000 series desktop CPU (central processing unit) launch on September 30.

On October 1, Videocardz leaked the surprise element of Intel’s X-series CPU—its price. Intel lowered the price of its Core X-series processors by 40%–50% to below $1,000. This way, it brought its HEDT CPUs in line with AMD’s Ryzen Threadripper CPUs.

PC makers are increasingly focusing on developing PCs and laptops that can handle future workloads like AI (artificial intelligence) and rendering. Recently, Microsoft launched the Surface Pro X laptop designed for AI workloads.

Intel is focusing its high-end desktop CPU on AI workloads. Today, Intel launched four Core X-series processors priced from $590 to $979. These processors are designed for advanced workloads like photo and video editing, game development, and 3D animation.

Intel also launched eight Xeon W-2200 series workstation desktop CPUs priced from $294 to $1,333. Intel’s W-2200 series CPUs are aimed at data science, visual effects, 3D rendering, complex 3D CAD, AI, and edge deployments. Both of these CPU series could hit the market next month.

Intel tries to beat AMD at its own game

AMD’s CPU strategy has been to deliver better price-to-performance than Intel. This strategy worked well for AMD, as it added more cores to improve its performance. AMD used its chiplet design to reduce the price.

Plus, AMD brought eight-core CPUs to the mainstream market, which was previously capped at four cores. It also increased the HEDT core count threefold from six to 18. AMD Ryzen offered a similar performance as Intel Core but for a lower price. However, AMD lagged in terms of power efficiency.

This year, AMD surpassed Intel in the process node technology with its 7nm (nanometer) Ryzen 3000 series CPUs. It also surpassed Intel in power efficiency. This puts competitive pressure on Intel to protect its CPU market share.

Intel’s Q2 earnings

In the company’s second-quarter earnings, Intel CEO Bob Sean admitted that it lost some CPU market share. He pinned this loss on supply shortage, but analysts believed that competition from AMD was also one of the causes.

Today, Intel finally took a step that officially confirmed that it was in a CPU war with AMD. Intel slashed the price of its X-series CPUs, codenamed Cascade Lake, by as much as 50% or $1,000. Such a large price cut should impact its margins but could also help it increase its volume shipments.

Intel-AMD Price War Begins with Cascade Lake-X Launch

Intel begins price war with AMD

As seen from the above table, AMD’s second-generation RT (Ryzen Threadripper) 2900 series offers higher cores than Intel’s Cascade Lake X-series CPUs. So, the Videocardz leak used price per core to compare the price-to-performance of the two CPUs.

Intel lowered its average price per core from $103 for the Sky Lake-X series to $57 for the Cascade Lake-X series. This price is in line with AMD’s RT 2900 series’ average price of $55 per core.

Like AMD’s RT 2900 series, Intel’s Cascade Lake-X series supports quad-channel DDR4-2933 (double data rate) memory. The Cascade Lake-X series offers a TDP (thermal design power) of 165 watts. The TDP tells us the amount of heat a CPU generates and how long it can be overclocked.

Intel’s CPUs still have an IPC (and a max clock speed) lead over AMD’s Ryzen and it is leveraging this advantage. Intel is offering additional features like Turbo Boost Max Technology 3.0 and Deep Learning Boost in its latest X-series processors.

To justify the $2 premium per core, Intel’s Cascade Lake-X series offers 256GB quad-channel memory. This is double the 128GB memory offered by AMD’s RT 2900 series. Also, the Cascade Lake-X series offers support for 72 PCIe (peripheral component interconnect express) 3.0 lanes as opposed to RT 2900 series 64.

An AnandTech article noted that Intel stopped its Cascade Lake X-series at 10 cores. It did so to differentiate its HEDT processor with its high-end eight-core consumer processor, the Core i9-9900K.

AMD’s next step

AMD is not far behind, as it’s set to launch its third-generation Ryzen Threadripper 3000 series processors in November. The RT 3000 series is expected to be built on the 7nm (nanometer) Zen 2 architecture, which would help the processor’s boost performance and energy efficiency.

A September 1 TechRadar article spotted a leaked benchmark in Geekbench, which showed that AMD’s third-generation RT was 30% faster than its predecessor. Intel’s Cascade Lake-X CPUs are competitive with second-generation RT CPUs. It remains to be seen how they will fare in front of AMD’s third-generation RT CPUs. Investors should also see how AMD prices its new RT series in light of Intel’s new price structure.

Behind Intel’s and AMD’s CPU war

This intense competition brings us to the question of why Intel and AMD are fighting over market share. The PC market has been declining since 2012. However, a July 2018 Gartner report showed that global PC shipments rose for the first time in six years in Q2 2018.

Gartner senior principal analyst Mikako Kitagawa said that PC shipments are growing as businesses replace their systems with Windows 10–supported systems. She expects this demand momentum to last for two years until they complete their Windows 10 refresh. This means that Intel and AMD should witness strong demand, especially among enterprises, until mid-2020.

Intel’s lower pricing could make it easier for developers and enthusiasts to upgrade from Intel’s consumer processors to HEDT processors.

Latest articles

Is the technology sector due for a correction? Twitter (TWTR) and Intel Corporation (INTC) will release their Q3 2019 stock earnings on October 24.

The Dow Jones Industrial Index (or DJIA) is trading just 2.2% below its all-time high. But is the stock bubble about to burst?

Renaissance Technologies had a strong investment in the healthcare sector in Q2 2019. The healthcare sector makes up 18.16% of the firm's total portfolio.

This week, semiconductor equipment suppliers Teradyne Inc. (TER) and Lam Research (LRCX) will report their quarterly earnings.

Major chip companies Texas Instruments (TXN) and Xilinx (XLNX) released their earnings last week and saw their stocks fall.

On October 18, CNBC reported Bill Gross top picks. His top stock picks were Annaly Capital (NLY), Invesco (IVZ) and Allergan (AGN).