Over at Seeking Alpha, contributor Ed McKernan recently speculated that Intel's (NASDAQ:INTC) Atom CPU line will be "snuffed out over the course of the next 18 months," in favor of the company's "big core" Broadwell and Skylake CPUs spanning from two-in-one convertible tablets/PCs all the way through servers. Note that McKernan indicated that he believes that Intel will exit the smartphone business, which would obviate the need for a lower-cost, lower-power CPU core.
However, I disagree that Intel plans to "snuff out" the Atom processor line -- and that Intel doesn't plan to play in smartphones, but that's an entirely separate issue -- and there is plenty of evidence to suggest that the company plans to continue building Atom cores.
Cutting to the chase: evidence that Intel is designing future Atoms
Whenever I want to get a sense of what a company is working on, I like to look at a company's job boards. While not perfect, the job boards are usually a pretty good way to get a handle on what capabilities and projects a company is looking to acquire talent for.
On Intel's job site, I did a search for "Atom," and found a number of jobs hiring specifically for the Atom team. On Nov. 25, Intel put up a job listing for "Atom CPU Lead Architect -- Advanced Pathfinding Technologies." The first paragraph of the listing is particularly helpful:
The Advanced Pathfinding Technologies (APT) team invents and prototypes innovative long-lead technologies with the potential to overcome the current barriers in traditional CPU development. We are hiring engineers with solid background in CPU architecture who are not afraid to explore new technologies, such as binary translation or HW/SW co-design, and bring them to the level of maturity needed to intercept Intel's CPU product lines.
Would a company that is planning to ax an entire CPU family really be hiring for long-term architectural Pathfinding efforts for that same product family? Intel is also hiring for several other positions on the Atom team, including an "Atom Design Automation Manager" for a division that Intel claims aims to deliver "low power Atom and Quark CPUs to address a variety of market segments."
It really doesn't look like Atom is getting the ax to me.
Even beyond smartphones, Atom is important
Let's suppose, for the sake of argument, that McKernan's assumption that Intel will bow out of smartphones is correct. (For the record, I do not believe this). Even without phones, the highest volume portions of the tablet market are likely to be the mid-range and the low end. Intel needs area/power optimized solutions for that market, and Atom -- which is smaller and lower power than Core -- fits the bill perfectly.
Now, even if you want to take it a step further and assume that Intel doesn't want to play in the low end and mid-range of the tablet market, note that Intel has leveraged its Atom CPU core in many other products. For example, according to Intel, the majority of its Pentium/Celeron PC parts are now based on the Atom core rather than the "big core," which allows it to both segment the market better and reduce its cost structure at the low end of the PC market.
The Atom core is also used extensively in the company's Internet of Things Group, particularly as there are applications there that require cheaper and/or lower power chips than what the selection of "big core" products offers.
In a nutshell, one size does not fit all in the broad spectrum of computing, and Atom is a critical part of Intel's broader strategy to get its chips into as many devices as possible.
Ashraf Eassa owns shares of Intel. The Motley Fool recommends Intel. The Motley Fool owns shares of Intel. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.