The popularity of mobile technology is making it a “critical year” for the companies and chip makers that create personal computers, Cowen & Co. analyst Matthew Hoffman told CNBC.
“The PC side of the equation was looking for 15 percent growth and got zero,” he said Monday. “PC analysts didn’t take into account the uptick from the iPads coming into the equation.”
The growth, he said, has been in mobile devices, particularly Apple’s iPad, he said. The personal computer may not be dead just yet, but the companies that can best adapt to mobile technology have a better chance of survival.
Microsoft’s Windows 8 operating system for mobile-based devices using ARM processors will be a boon for Qualcomm in the second half of the year, he said, which is why it is one of his top picks in the sector.
“Qualcomm, for the first time, is making chips for the Windows market,” he said. “So it’s all incremental business for them.”
By contrast, he expects Intel to lose market share because “its exposure in servers is so strong right now. We’ll see if they suffer some share loss.”
Intel’s current architecture, he said, “consumes too much heat, too much power to be a truly mobile technology to compete head-to-head with the ARM-based technologies. Look for Intel to have to narrow that gap” with companies using ARM.
He noted: “The ARM players look to have the advantage.”
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Neither Matthew Hoffman nor his company own shares in Qualcomm but gave no disclosure information on Microsoft or Intel.