Intel shares are set for a historic drop on the day if losses hold, marking the largest one-day loss since the Great Recession.
While the short-term pain is unavoidable and the billions in guidance cuts for 2019 make the stock price plunge likely deserved, the long-term efforts from the company's Mobileye autonomous driving subsidiary are an interesting nugget of hope.
"Another TAM-expanding business that continues to gain traction is Mobileye, with eight new global ADAS [Advanced Driver Assistance System] designs in the first quarter alone, including our first win in India," CFO George Davis told analysts on Thursday night. "Mobileye's real-time crowd-sourced mapping technology, Road Experience Management or REM, continues to build momentum with a major North American automaker adopting this breakthrough data-centric capability. Autonomous driving is a technology inflection that we're ready to lead."
He added that the segment saw record revenue in the first quarter, up 38%, on the larger customer base for the subsidiary acquired for a hefty $15.3 billion in 2017.
The North American partner was not named as memory pricing and gloomy revenue forecasts clouded the question-and-answer session. Nonetheless, it is known that the company has received investments from European automaker Volkswagen (VWAGY) , Chinese tech giant Baidu (BIDU) , and even Google's Waymo project.
The company has not been shy to tout its leadership in the space as of late, challenging key competitor Nvidia (NVDA) and its CEO Jensen Huang directly.
"If imitation is the sincerest form of flattery, then Nvidia must think very highly of us," Mobileye CEO Amnon Shashua joked in a recent blog post. "Based on the information that has been made available, it is clear Nvidia's leaders have continued their pattern of imitation as their so-called "first-of-its-kind" safety concept is a close replica of the RSS model we published nearly two years ago. In our opinion, SFF is simply an inferior version of RSS dressed in green and black. To the extent there is any innovation there, it appears to be primarily of the linguistic variety."
If Shashua's position is correct, it would suggest that Intel is the true leader in the autonomous driving space and is simply not receiving credit.
To be sure, the company's confidence is not reflected in its work force.
As Nvidia continues to build out its R&D capabilities for autonomous driving, Intel is slashing its staff.
The Information reported on Tuesday that the company laid off "several dozens" of employees from its Mobileye business in Silicon Valley, moving the bulk of operations to Israel.
"Changes in our workforce are driven by the needs and priorities of our business, which we continually evaluate," an Intel spokesperson told the publication. "We are committed to treating all impacted employees with professionalism and respect."
It is unclear what positions these employees held at the subsidiary or if they might be relocated to different business units as is possible.
Possibly related, Mobileye recently acquired Eonite Perception, a 3D mapping and tracking company that could hold key solutions to the issues confronting the AI-focused shift to self-driving. The acquisition could have made many employees redundant, or alternatively stretched the budget for the program.
Overall, if one is looking for some positives from the Intel report, there aren't many on the near-term horizon.
However, in the long term autonomous driving could be a significant growth driver that is not on many investors' radars.