Intel First-quarter earnings beat Wall Street’s earnings-per-share forecast on Thursday, but sales underperformed. Intel’s forecast for the current quarter is weak.
The stock fell 8% in after-hours trading.
Here’s how Intel’s results for the quarter ended in March compare to LSEG’s consensus estimate:
- Earnings per share: Adjusted 18 cents, expected 14 cents
- income: US$12.72 billion, expected US$12.78 billion
Intel expects second-quarter earnings of 10 cents per share on midpoint revenue of $13 billion. By comparison, analysts had expected earnings of 25 cents per share on sales of $13.57 billion.
In the first quarter, Intel reported a net loss of $400 million, or 9 cents a share, compared with a net loss of $2.8 billion, or 66 cents a share. Last year.
Revenue was US$12.7 billion, compared to US$11.7 billion in the same period last year, a year-over-year increase of 9%.
Intel CEO Pat Gelsinger told investors on an earnings call to focus on the company’s long-term prospects.
“We’re one of two, maybe three, companies in the world that can continue to enable the next generation of chip technology,” Gelsinger said.
Intel’s report is the first time the company has revealed that it has restructured its financial reporting to make its chipmaking business, known as Intel Foundry, a separate project with its own costs and sales.
Intel said its foundry business had revenue of US$4.4 billion in the quarter, down 10% year-on-year. The unit reported an operating loss of $2.5 billion in the third quarter. Intel said last month that its Foundry operating loss was $7 billion in 2023.
Intel’s biggest business is making chips for PCs and laptops, sold for client computing. Sales of these chips totaled $7.5 billion, up 31% year over year.
Intel also makes server central processing units as well as other components and software, reflected in its data center and artificial intelligence businesses. While Intel continues to compete for server dollars with artificial intelligence chips made by companies like Nvidia, sales of the product line rose 5% to $3 billion.
Earlier this month, Intel said it would release a new server AI processor called Gaudi 3, designed to compete with Nvidia’s popular GPUs, though it won’t be available until later this year. Intel said it expects sales of its Gaudi 3 chips to exceed $500 million in the second half of this year.
