US chip giant Intel shipped a record number of microprocessors during Q3 and posted best-ever quarterly sales of $14.6 billion – helped in part by Internet of Things and a recovering PC market – but the mobile and communications group could only muster revenue of $1 million, down from $353 million during Q3 2013.

Brian Krzanich (pictured), Intel’s chief executive, vowed a bigger push on mobile when he took the helm in May 2013, but third-quarter results show he has still much work to do. The figures were described as “consistent with expectations”.

The mobile and communications group posted an operating loss of just over $1 billion over the three-month period, eclipsing the $810 million deficit in Q3 2013.

Speaking at the company’s Q3 earnings call, however, Krzanich pointed out that losses at the mobile and communication group had declined sequentially ($1.2 billion red ink during Q2 2014). “That’s the trend we need to see continue,” he said.

Krzanich added that tablet volume was nearly 15 million units during Q3 and that Intel remains on track to reach its 40 million unit goal for 2014. The chief executive flagged up other encouraging mobile developments during the quarter, such as Samsung’s decision to use Intel’s Cat6 LTE modem with carrier aggregation.

“The strategic importance of these capabilities continues to grow,” maintained Krzanich. “Our LTE technology, which we originally developed for phone is becoming increasingly valuable in tablets and even PCs as wireless wide area network connectivity becomes increasingly common.”

Analyst Jack Gold, for all these encouraging signs, thinks it will take Intel at least three or four quarters before it can turn the mobile and communications group around.

“It’s betting heavily on SoFIA – Intel’s SoC with an LTE radio built in – finally making it competitive with integrated ARM-based mobile chip vendors like Qualcomm, NVidia and MediaTek,” he said.

But a new design win with Asus (announced today) as well as recently announced strategic partnerships with Rockchip and Spreadtrum – two important players in China – should give Intel a boost, said Gold, and “dramatically increase the use of Intel chips in the mid to lower end of the smartphone and tablet markets”.

Rockchip is a leading fabless semiconductor company in China, as well as a mobile-internet SOC solution provider. Spreadtrum is a Chinese smartphone chipmaker.

At a group level, Intel’s Q3 sales were up 8.8 per cent and reached a record $14.6 billion. The firm shipped more than 100 million microprocessors, buoyed by growing volumes of PC, server, Internet of Things, phone and tablet products. It’s the first time Intel has passed the 100 million landmark over a three-month period.

Internet of Things group revenue was up 14 per cent, year-on-year, to $530 million, while PC client group revenue grew 9 per cent, to $9.2 billion. Data centre group revenue jumped 16 per cent, to $3.7 billion.

Intel’s net income was up 12 per cent, to $3.3 billion.