Please ensure Javascript is enabled for purposes of website accessibility

Instant Analysis: Intel Snaps Up Computer Vision Company to Boost Its Internet of Things Offerings

By Chris Neiger - May 27, 2016 at 3:30PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The computing vision company will help Intel lay a foundation for broader IoT products.


Image source: Intel. 

What happened?
Intel (INTC -3.51%) just agreed to buy Itseez Inc., a company that specializes in making computer vision (CV) technology and algorithms. Neither company disclosed the terms of the deal, but Intel says the addition will expand its footprint in driverless cars and the broader Internet of Things (IoT) market. 

Computer vision allows devices to not only acquire visual information, but also process and analyze it so IoT systems can make decisions based on what they see. For example, an autonomous car uses cameras to see vehicles, pedestrians, and other objects, and it makes driving decisions based on that information. 

"Computer Vision technology is quickly becoming critical for the future of smart and connected 'things' from autonomous vehicles, security systems, medical imaging and more," Intel's senior vice president and general manager of Internet of Things Group Doug Davis said in a press release

Does this matter for shareholders?
This move is important for Intel in light of its recent layoffs and pivot toward the IoT. 

Intel is now diving into the driverless car market, though only in a relatively small fashion. That's notable because the broader driverless cars market is expected to be worth $242 billion by 2025.

Still, it'll face some competition in the computer vision space. Israel-based MobileEye (MBLY) makes automotive vision systems for semi-autonomous cars, and its camera hardware is in 270 vehicle models this year.

Itseez's technology focuses more on algorithms rather than hardware, and its tech is used for security cameras and industrial equipment as well as cars. That means Intel won't be competing directly with MobilEye with this move, but it's certainly creeping into the company's territory.

Intel views Itseez's technology as a cornerstone for some of its future IoT ambitions in digital security, surveillance, and industrial inspection, as well as a way to expand its deep learning capabilities.

For that reason alone, the purchase is likely an important move. Intel is transitioning away from PCs, and any steps it can take toward a broader IoT portfolio should be a welcome one. Just don't expect revenue from the deal quite yet. The company is likely snatching up Itseez so it can implement its technology into future products, which could take time to develop.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Intel Corporation Stock Quote
Intel Corporation
INTC
$40.53 (-3.51%) $-1.48
Mobileye N.V. Stock Quote
Mobileye N.V.
MBLY

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
331%
 
S&P 500 Returns
115%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/20/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.