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So far, this year has been a positive one for technology companies.

In their most recent quarters, major players such as Apple and Netflix have blasted past expectations, surprising analysts and investors.

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Chip maker Intel (INTC) has been among the winners. The company's fourth-quarter revenue came in at $16.3 billion, up 10% improvement from a year earlier, beating the consensus forecast of $15.75 billion.

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But the quarter also solidified 2016 as a comeback year for the Silicon Valley company.

For years, Intel has tried to break into the mobile-phone business. Last year, it finally secured a deal with Apple to provide chips for the iPhone 7.

And Intel has also been trying to push further into the lucrative cloud computing space. Its Data Center Group segment saw an 8% year-over-year revenue rise.

But some of Intel's largest and most surprising upticks have been in the personal computer division. It is in this sector in which investors can find a key to unlock profits.

The PC division had been struggling of late. PC sales are down, and thus Intel hasn't benefited from much demand for its microprocessors, which control 99% of the market.

However, one segment of the population is actually seeing an increase in PC sales: gamers.

Video game players are not only using newfangled gadgets and phones on consoles made by Microsoft,Nintendo and Sony, but they are also playing games on their PCs.

The esports industry, in which teams of professional game players go head-to-head for high-stakes prizes, is expected to deliver revenue of more than $1 billion this year, up from $893 million last year.

And Intel's game-oriented chips, which are more expensive than traditional microprocessors, are in demand.

Sales of PC desktop computers intended for gaming increased by 8% last year, a major improvement from the 13% decrease in 2015, according to Jon Peddie Research.

Keep in mind that Intel provides chips for about 99% of desktop systems.

The chips that Intel sells for video game PCs, including functionality for recording high-definition video as well as playing the games themselves, cost upwards of $2,000 apiece. So even if the number of PC chip sales decreases, the amount of money spent on these high-end chips will likely continue to increase and offset any drop.

Intel's stock hit an all-time high last Monday following the quarterly earnings report. But there could still be some momentum left, especially as esports becomes an even bigger market.

Look for dips in Intel's share price as an opportunity to get in.


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The author is an independent contributor who at the time of publication owned none of the stocks mentioned.