Yes their chips with 128MB eDRAM are faster than Intel's other chips, but when they are not noticably faster than AMDs chips that don't have any on-package RAM, it's a bit of a hollow victory - and just proves how bad the rest of the intel onboard graphics still are.
I wouldn't read it that way. Compare the 4770K (HD 4600 graphics = 20 cores, no onboard memory) to the 4770R (Iris Pro 5200 graphics = 40 cores, onboard memory). The former is about 3.25x faster, but we'd expect 2x the speedup just from doubling the core count, so maybe +60% of the performance comes from the cache alone.
That's a pretty big jump, if it worked for the 7850K it would be posting about 40 FPS on Bioshock Infinite@1080p, i.e. 50% faster than the Iris Pro.
In other words, the Iris Pro GPU is way weaker than Kaveri, but the onboard cache makes it competitive.