Intel has higher yields than its competitors, giving it more useable chips per wafer burned, and thus a lower cost per chip. So even when it sells its product for less than the competition, it can still turn a greater profit. Sales volume and profits are greater than the competition. Intel stock price prediction. Intel's recent analyst-frightening move was to upgrade its microprocessor fabrication facilities in New Mexico, Arizona, and now Ireland to 0.25 micron technology.
Smaller chips are naturally faster, because a signal takes less time to travel down shorter wires.
Smaller chips also take up less space on a silicon wafer, meaning the new process can fit more chips on each wafer for roughly the same price per wafer as the old process. Not according to Wall Street. Merrill Lynch's Thomas Kurlak finally noticed that Intel is in a position to outright flood the market with cheap high-end CPUs. Kurlak announced that the increase in chip supply was almost certain to lower prices and eat into Intel's gross margin. In the short term, he's probably right, and Intel knows it.