In the latest Investor Day presentation, Intel (INTC -1.44%) made a shocking announcement that took most investors by surprise. After delivering an amazing presentation on the company's product road map for 2014, management announced that revenue for 2014 would be flat, compared to 2013 revenue. 

After the announcement, Intel's market capitalization declined by 5.4%, as several investors reconsidered their bullish positions. Although the company remains one of the most innovative research-driven institutions in the semiconductor space, there is a high level of uncertainty regarding Intel's ability to compete against Qualcomm (QCOM -1.64%), which is better positioned in the mobile market, or ARM Holdings (ARMH), which outsources manufacturing of its chips to avoid maintaining a heavy cost structure. Moreover, investors remain worried about shrinking PC sales, the only segment in which Intel remains strong. Under this difficult context, how does Intel plan to improve its top line performance in the long run?

Intel's zero revenue growth projection
Intel projects zero revenue growth next year because the company will be giving away 40 million Bay Trail chips, which are specifically designed for tablets and hybrids. This will allow Intel to gain tablet market share, a space currently ruled by ARM. Considering that ARM-based low-power chips are found in virtually all tablets, Intel had to use a very aggressive strategy to start capturing meaningful market share. 

According to semiconductor expert Russ Fischer, this "gift to tablet manufacturers" will cost Intel roughly $1.2 billion.The good news is that, long term, Intel's investment could pay off, as the company will win sockets and increase its presence in the tablets market. The company is preparing the road for 2015.

Intel is a very-long-term value play
Although Intel's short-run weak forecast offers limited upside, it is important to remember the company is still paying the consequences of missing the smartphone revolution. However, the company's plan to catch up is very consistent. Apart from investing heavily in mobile strategies, Intel remains focused on discovering new cash cows -- for example, its foundry, datacenter, and security business units -- that could offset the negative effects from a slow mobile catch-up and weaker PC sales. 

Source: Intel Investor Meeting 2013

The foundry business looks particularly promising. It has allowed competitor Taiwan Semiconductors to enjoy strong sales in past quarters, and could help Intel improve its top line significatively. Foundry basically involves using Intel's manufacturing plants and development resources to build chips for other companies. 

In terms of security, Intel is on its way to consolidate its McAfee antivirus software as the standard tool against PC cyber threats. Intel has a strong competitive advantage in this area because the company uses an approach that combines software and hardware to enable safer computing experiences. The company is poised to launch 30 new McAfee products in the near future.

Finally, the mobility business remains challenging, as Qualcomm's market position is very strong. Qualcomm is the main innovator behind the CDMA network technology, which acts as the backbone of all 3G networks. As a result, handset makers must pay royalties to Qualcomm -- between 3%-5% of the price of the handset, according to Morningstar -- if they want their mobile phones to work on CDMA-based networks. This recurrent business allows Qualcomm to enjoy high, safe margins.

Intel has a chance to capture market share in the mobility segment if it uses an aggressive pricing strategy for its XMM 7160 modem, which can work on 2G, 3G, and 4G LTE networks. Because this new modem is said to support up to 15 LTE bands simultaneously to allow for global roaming and other advanced features, it is regarded by most reviewers and critics as the best choice in the market, tech-wise. However, unless this modem is attractively priced, handset makers may not have enough incentives to readapt and redesign their models, which are already based on Qualcomm technology.

Final Foolish takeaway
Because Intel predicts zero revenue growth for 2014, short-term upside is very limited. However, the research-driven company also remains focused on building new cash cows -- security, data centers, and foundry -- in the long run, and it is set to capture more tablet market share next year -- by giving away 40 million chips. Because of this, Intel could be a great long-term play, only suitable to patient investors.