Intel Group shares fell in Thursday’s long trading despite a sharp drop in earnings and raised annual forecasts, as data center sales plummeted due to the strength of sales. Personal computers and the memory business are about to launch.
Shares fell about 2.5% in after-hours trading, after falling 1.8% in regular session, to close at $ 62.57.
Intel’s data center group saw revenue drop more than 20% to $ 5.56 billion, while analysts surveyed by FactSet expected $ 5.89 billion. Intel is facing increasing competition from rival Advanced Micro Devices Inc.
and GPU specialist Nvidia Corp.
in the data center category.
In a call with analysts, Intel CEO Pat Gelsinger, in the first earnings report since the takeover officially noted that Intel just launched its new generation of Xeon server chips. , code-named “Ice Lake” and the industry is just getting started. emerged from the analysis phase from the data centers and Intel is “starting to see signs that it wants to begin the next building phase in its cloud.”
“We’ve shipped Ice Lake to more than 30 customers including major cloud media providers, businesses, and [high performance computing] Gelsinger added that Intel will be very active in the marketing of data centers.
“We will fight for every outlet in the market,” said Gelsinger.
On the PC side, Gelsinger says PC demand has skyrocketed to levels not seen since 2012 because of the COVID-19.
“And that is continuing,” said Gelsinger. “2021 is shaping up to be the biggest PC market ever. In fact, we shipped more laptop CPUs in Q1 than any other quarter in our history. The CEO said that “one computer in every home is not enough.”
Intel’s largest segment – the client computer, the traditional PC group – grew more than 8% to $ 10.6 billion, with analysts expecting $ 10.17 billion.
Intel reported first quarter net income of $ 3.4 billion, or 82 cents a share, compared with $ 5.66 billion, or $ 1.31 a share, for phase one. last year. After adjusting more than $ 2.2 billion for restructuring and other efforts, as well as other adjustments, Intel reported earnings of $ 1.39 a share, compared with $ 1.45. A stock from a year ago.
Revenue dropped to $ 19.7 billion from $ 19.83 billion in the previous quarter, for the third consecutive quarter year-over-year revenue fell, but was much higher than expected. Analysts estimated adjusted earnings of $ 1.15 a share on revenue of $ 17.79 billion, while Intel forecasts adjusted earnings of $ 1.10 a share per share. collected about 17.5 billion dollars. Intel also noted that sales after eliminating the memory business it sells for $ 18.6 billion, are still much higher than analysts’ estimates.
Intel predicts annual revenue on Thursday of about $ 77 billion, or $ 72.5 billion, if excluding the memory business and adjusted earnings of $ 4.60 per share. Gelsinger previously targeted $ 4.55 a share for $ 76.5 billion in revenue.
For the second quarter, Intel forecasts revenue of $ 18.9 billion, or $ 17.8 billion when it comes to memory and non-GAAP earnings exclusion of $ 1.05 per share. promissory note. The average analyst expects second-quarter adjusted earnings of $ 1.09 a share on $ 17.55 billion in revenue.
Patrick Moorhead, principal analyst at Moor Insights & Strategy, said: “Overall, Intel had a good quarter as it is capitalizing on the huge increase in overall PC demand for PCs,” said Patrick. Moorhead, principal analyst at Moor Insights & Strategy, said in an email. “The data center numbers were planned to drop at these levels, but I think some industry analysts may be making some misallocations in their calculations.”
Intel reported that revenue from inflexible memory solutions fell slightly to $ 1.11 billion, well ahead of Wall Street expectations of $ 563.8 million. “Internet of Things” or IoT, revenue has grown to 914 million dollars, compared with an expected figure of 774.9 million dollars. Mobileye revenue was $ 377 million, while Street was expected to be $ 332.3 million.
Over the past 12 months, Intel shares have risen 4%, while the Dow Jones Industrial Average
– of which Intel is a component – rose 44%, the S&P 500 index
gained 48%, the tech-heavy Nasdaq Composite Index
rose 63% and the PHLX Semiconductor Index
increased to 86%.