Intel Corporation’s Atom Z3580 Is Another Big Step Forward

Intel's (INTC -2.40%) mobile group has had some pretty serious execution issues during the last several years. It's not that the company can't design good, low-power chips; it's that by the time these parts actually make it to market, they're just not that great anymore, and end up in the proverbial bargain bin. At Computex 2014, Intel shared some performance numbers for its recently released Atom Z3580 (codenamed Moorefield) product, and the numbers do look good, but investors should view it more as a key technological milestone rather than a product that will drive meaningful top/bottom line upside this year.

CPU performance looks fantastic
Intel's Z3580 is based on the Silvermont CPU core announced last year, and performance tests generally suggest that it is best-in-class as far as CPU performance goes. In terms of power consumption it is exceptionally good. While the following slides come from Intel, the numbers tend to jive with the performance results that we have seen with Intel's Atom Z3770, which has been available in systems for nearly a year.

Source: Intel.

As you can see, both the Intel and Qualcomm (QCOM -2.36%) chip are faster than the ridiculous "octa-core" MediaTek part -- which uses eight wimpy cores versus Qualcomm/Intel, which use four strong ones. The Intel chip seems to be about 27% faster than the Snapdragon 801 in a real-world application. This is an impressive showing, especially since the Intel chip is delivering this kind of performance in a 4.5-inch reference design against the Snapdragon 801 found in a 5.1-inch device.

Graphics performance looks good, too
Intel also showed some performance comparisons of the Z3580 against the Snapdragon 801 in graphics workloads. The two benchmarks chosen are GFXBench 3.0 T-Rex HD and 3D Mark 1.2 Ice Storm Unlimited, and the results can be seen below.

Source: Intel.

In 3DMark Ice Storm Unlimited, the Z3580 edges the Snapdragon 801 out by a respectable 12%. To put this in perspective, according to AnandTech, the Snapdragon 801 is about 22% faster than the Imagination G6430 found inside of the Apple (AAPL -1.22%) A7, which uses the same GPU block as Intel's Z3580. The clock speed improvements brought about by Intel's 22-nanometer FinFET process have a meaningful impact on performance.

Source: Intel.

In GFXBench, we see a slight lead again for Z3580, eking out a 15% performance lead over the Snapdragon 801. Both the Snapdragon and the Atom are dramatically ahead of MediaTek's solution.

If we look at how the Apple A7 compares to the Snapdragon 801 in AnandTech's testing, we see that the Snapdragon 801 can render the test at an average of 27 frames per second, while the iPad Air delivers 26.2 frames per second. The numbers here suggest that Intel's implementation delivers 31 frames per second -- a 20% improvement over Apple's implementation.

When will we see Z3580 in action?
ASUS announced a tablet based on the Moorefield platform, but what everybody really cares about is when this chip will find its way inside of a smartphone. Intel has indicated that this platform will be paired with the company's discrete XMM 7260 LTE-Advanced modem. This modem is quite good, even if it isn't integrated into the apps processor.

Since Intel has indicated that the XMM 7260 is shipping to customers for interoperability testing, I would not expect phones on the shelves with Z3580 with the latest modem until late Q3/early Q4. We may see phones with Z3580 paired with the older XMM 7160 modem beforehand, although the value proposition of that solution against a Snapdragon 801 -- which integrates a better modem than XMM 7160, as well as connectivity -- seems limited.

Foolish bottom line
Anybody who says that Intel can't deliver strong performance/power optimized smartphone silicon is just plain wrong. There are good reasons why Intel hasn't won all that many smartphone designs to date, and these are issues that Intel needs to work through, but the worst of it is over. Intel can deliver world-class, power-optimized chips from a CPU/graphics perspective and, as the company improves its image signal processor, and integrates its modems into future products, it should have a much easier time gaining traction.

Intel's Z3580 isn't a Qualcomm-killer, but the next generation part, codenamed Broxton, could very well be the first product that gets Intel into a flagship, tier-1 smartphone, bolstering investor confidence, and illuminating a path to share gains and, eventually, profitability.