Intel (NASDAQ:INTC) is aggressively ramping its Atom chips offering to target handhelds, tablets, connected TVs, automobiles, industrial applications, and other applications.

While some efforts could gain traction such as set-top boxes and industrial applications, the real question is whether Intel's efforts will succeed in the handset sector, or materially impact overall profits.

While we historically have questioned whether Intel's efforts will work, and have noted that Intel has a long track record of poor performance in penetrating new markets outside of PCs, FBR Capital Markets analyst Craig Berger wrote in a note to clients.

The analyst has a point as Intel has a long list of failed efforts outside the PC space, including handset chips (XScale), optical chips (Giga), Wi-Fi chips (ramping down there), networking chips, TV processors (Oplus), and others.

At its recent analyst day event in mid-May, Intel announced a somewhat meaningful acceleration of their Atom roadmap, aiming to introduce three process technologies in three years (accelerating tick-tock) with Saltwell at 32 nm, Silvermont at 22 nm, and Airmont at 14 nm.

Additionally, Intel is increasing their focus on Atom features like 'instant on', improved battery life and power consumption versus ARM-based processor solutions, and in security baking in McAfee security into the Atom and mainstream processors.

Intel also said it is moving from 30-watt to 40-watt processors for lower power notebook designs to 15-watt processors now, and to 5-watt processors for System on Chip applications.

Intel did back off from its Nokia partnership following Nokia's decision to more closely align with Microsoft, and did not announce any new smartphone wins at its analyst day meeting. Rather, the management said that it still aims to have Medfield-based handsets in the market in early 2012, and that it would let its handset design-wins speak for themselves as opposed to trumping any wins.

Net, we still think it will be second half of 2013 before Intel's 22 nm tri-gate transistors make it into smartphone-based SOCs, likely requiring meaningful patience from investors awaiting more traction from Intel in this area, said Berger, who downgraded Intel stock to market perform from outperform.

Meanwhile, some evidence is building that Intel is seeing traction with its embedded processors in some markets like industrial, medical, automotive and connected TVs/cable boxes.

While the total company contribution is still relatively small, embedded shipments are likely adding to earnings, and Intel could continue to build this into a bigger business going forward, said Berger, who has a price target of $26 on Intel stock.