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Table of Contents
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS (Continued)
For 2009, net revenue for the PCCG operating segment decreased by $1.8 billion, or 6%, compared to 2008. The decrease in
microprocessor revenue was primarily due to lower notebook microprocessor average selling prices, and lower desktop
microprocessor unit sales and average selling prices. These decreases were partially offset by a significant increase in netbook
microprocessor unit sales due to the ramp of Intel Atom processors. The decrease in chipset, motherboard, and other revenue
was primarily due to lower chipset average selling prices and lower unit sales of wireless connectivity products, partially offset
by higher chipset unit sales.
Operating income decreased by $1.8 billion, or 19%, in 2009 compared to 2008. The decrease was primarily due to lower
revenue and approximately $810 million of higher factory underutilization charges, partially offset by lower platform unit
cost.
Data Center Group
The revenue and operating income for the Data Center Group (DCG) for the three years ended December 25, 2010 were as
follows:
Net revenue for the DCG operating segment increased by $2.2 billion, or 35%, in 2010 compared to 2009. The increase in
microprocessor revenue was primarily due to significantly higher microprocessor unit sales and, to a lesser extent, higher
microprocessor average selling prices. The increase in chipset, motherboard, and other revenue was due to significantly higher
chipset unit sales and significantly higher revenue from the sale of wired connectivity products.
Operating income increased by $2.1 billion in 2010 compared to 2009. The increase in operating income was due to
significantly higher revenue and, to a lesser extent, lower chipset unit cost.
For 2009, net revenue for the DCG operating segment decreased slightly by $140 million, or 2%, compared to 2008. The
increase in microprocessor revenue was due to higher microprocessor average selling prices, partially offset by lower
microprocessor unit sales. The decrease in chipset, motherboard, and other revenue was primarily due to lower chipset average
selling prices.
Operating income increased by $164 million, or 8%, compared to 2008. The increase in operating income was primarily due to
higher microprocessor revenue and lower operating expenses, partially offset by approximately $150 million of higher
costs as well as lower chipset revenue.
Other Intel Architecture Operating Segments
The revenue and operating income for the other Intel architecture (Other IA) operating segments, including the Embedded and
Communications Group (ECG), the Digital Home Group, and the Ultra-Mobility Group, for the three years ended December
25, 2010 were as follows:
Net revenue for the Other IA operating segments increased by $382 million, or 27%, in 2010 compared to 2009. The increase
was primarily due to significantly higher revenue within ECG from significantly higher microprocessor and chipset unit sales.
Operating loss decreased by $119 million in 2010 compared to 2009. The operating loss decrease was primarily due to
significantly higher ECG revenue and lower ECG unit cost, partially offset by higher operating expenses in ECG and the
Ultra-Mobility Group.
For 2009, net revenue for the Other IA operating segments decreased by $361 million, or 20%, compared to 2008, and
operating loss for the Other IA operating segments increased by $116 million in 2009 compared to 2008. The changes were
primarily due to lower revenue from the sale of communications products within ECG, primarily as a result of business
divestitures.
33
(In Millions)
2010
2009
2008
Microprocessor revenue
$
7,361
$
5,301
$
5,126
Chipset, motherboard, and other revenue
1,332
1,149
1,464
Net revenue
$
8,693
$
6,450
$
6,590
Operating income
$
4,395
$
2,299
$
2,135
(In Millions)
2010
2009
2008
Net revenue
$
1,784
$
1,402
$
1,763
Operating income (loss)
$
(60
)
$
(179
)
$
(63
)