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Intel To Develop Autonomous Vehicle Solution To Compete Against Nvidia, Mobileye; CLSA Remains Unimpressed

Intel To Develop Autonomous Vehicle Solution To Compete Against Nvidia, Mobileye; CLSA Remains Unimpressed - Intel Corporation NASDAQ:INTC, Mobileye N.V. NYSE:MBLY

CLSA's Christopher Caso commented on Intel Corporation INTC 0.77%'s recent autonomous driving effort after visiting Intel's Developer Forum.

Although the analyst highlighted the lack of details or plans for Intel's proposed autonomous driving initiative, he said the company was serious about entering the space. Intel sees itself competing with NVIDIA Corporation NVDA 0.26%, Mobileye NV MBLY 1.39% and others, according to Caso.

In order to prepare for the transformation, Intel intends to move from a distributed computing architecture to a centralized "server-like architecture" with strong links to the cloud, according to the CLSA analyst. Additionally, Intel plans to work with Mobileye on the recently announce BMW autonomous vehicle project, while competing with suppliers such as Nvidia and NXP Semiconductors NV NXPI 0.89%.

Taking Down Nvidia

"For the third time in two days, Intel made the case that its Xeon Phi architecture was a more suitable solution than Nvidia's GPU for deep learning applications," stated Caso. Intel management argued its CPU capabilities would lead to reduced latency and full use of system memory would bring more value than Nvidia.

"INTC feels that a combination of CPU and FPGA will be a more effective solution than the use of a GPU," said Caso. The analyst claimed Intel's argument had merit, but also highlighted Nvidia's increasing strength, putting the company on the radar of many competitors.

The analyst reiterated Intel's Underperform rating and $35.00 price target.

At time of writing, Intel traded at $35.18, up 0.60 percent Friday.

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DateFirmActionFromTo
Aug 2016NomuraMaintainsBuy
Jul 2016OppenheimerMaintainsPerform
Jul 2016Deutsche BankMaintainsBuy

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