Why Intel Stock Inched Higher Today

New product announcements from companies are often greeted warmly by their investors. So it was with Intel (INTC 2.05%) on Tuesday. News of a highly efficient new chip from the company stirred some excitement in the market, and Intel’s stock closed the day more than 2% higher in price as a consequence.

So what

On Monday after the market opened, Intel said at a tech industry conference that its Sierra Forest chip will boast 240% better performance per watt than the data center chip it presently has on the market. According to Reuters, this is the first time the company has divulged such a statistic for one of its products.

This means that Sierra Forest will be able to handle far more processing work for the power it uses than current offerings. As we’re in an environment where green solutions are becoming more important than ever, this news resonated with investors. Because of their nature, data centers use vast amounts of electricity to power their operations.

Intel said the Sierra Forest will hit the market next year. It did not get more specific. At that point, it will have two data center chip lines, Granite Rapids and Sierra Forest. Granite Rapids will consume more power but apparently will compete on performance.

Now what

Intel, once the 800-pound gorilla of the chip space, has been struggling lately in the face of intensifying competition. Some investors had also been disheartened by the company’s abandonment of its planned $5.4 billion acquisition of analog semiconductor maker Tower Semiconductor.