I have been critical of Intel's (INTC -1.70%) execution in a number of areas as of late. The company's multibillion-dollar effort to become a major player in the market for mobile silicon has not yet borne fruit (and it seems increasingly unlikely that it ever will). Its chip manufacturing prowess, for many generations simply taken for granted, is now under credible attack by powerful, well-funded entities.

However, even in light of these criticisms, it's not hard to point out areas where the company has proven incredibly formidable. In the market for server processors, the company's execution has been exceptional, if not flawless, with the segment bringing in billions in revenue and fat operating margins.

The company's execution in its largest market -- the market for personal computer chips -- has also been quite excellent. Its products here are far and away the best in the business and the innovations that the company delivers each year tend to be quite good.

Sadly, for all of that investment in making the PCs of tomorrow substantially better than those of today, the market for personal computers just isn't receptive to those innovations.

Why I wanted to see Intel compete well in the mobile market
Although part of the reason that the personal computer market has been underwhelming over the last few years is that PCs have simply gotten very good and people don't need to replace them as often, it's clear that there's another factor in play: the rise of mobile devices.

Prior to the rise of the smartphone (and, to a lesser extent, the tablet), people required either notebook or desktop PCs to access the increasingly rich Internet. However, as smartphone performance has grown (and, boy, has it grown), the PC has become increasingly irrelevant to the average consumer

Smartphones are always with us and can now perform the vast majority of "casual" tasks such as web surfing, social media, email, and casual games that people want to do.

Of course, for work, content creation, and specialized forms of content consumption (e.g., high-performance computer games), PCs will still be required. However, the harsh reality is that the subset of users with such requirements within the overall PC market represent just a fraction of total potential PC buyers.

It is for this reason that I would have liked to see Intel emerge as a strong player in the market for mobile processors; the future of client computing is mobile and Intel is not, and is not likely to be, a major player there.

Intel is now a data center company milking the PC cash cow
You can tell that Intel's outlook for the PC market isn't particularly rosy over the long term, with the company making it crystal clear to investors that its goal is to try to keep PC-related revenues as "flat" as possible. It has also suggested that it will optimize the segment for profitability (i.e., cutting costs/investments).

If Intel can actually keep its PC business flat in the coming years, it would be quite an impressive feat given the multiyear degradation in the PC market. Indeed, at this point, I'm bracing myself for a multiyear decline from here, though the magnitude of the decline remains unclear.

The great hope for Intel over the long term now lies in the data center. This is why the company has been feverishly investing to defend its market share in servers while aggressively going after large adjacent opportunities such as the networking chip market.

The good news is that, as long as Intel can maintain its dominant position in this market, it should be able to grow its data center business at a rapid enough clip to offset potential PC declines. The bad news is that Intel becomes almost entirely dependent on a single, high-margin business unit, increasing the risk around the stock.