Intel CEO Pat Gelsinger holds an Intel chip and speaks at the 54th Annual Meeting of the Semafor 2024 World Economic Summit in Washington, DC, April 17, 2024.
Mandel Yan | AFP | Getty Images
Intel First-quarter earnings reported Thursday beat Wall Street’s earnings-per-share forecasts, 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 ending in March compare to LSEG’s consensus estimates:
- 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 mid-range revenue of $13 billion. By comparison, analysts 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 with US$11.7 billion in the same period last year, an increase of 9% compared with the same period last year.
Intel CEO Pat Gelsinger told investors on an earnings call to focus on the company’s long-term potential.
“We are one of two, maybe three, companies in the world that can continue to deliver next-generation chip technology,” he said.
The quarterly earnings report was the first since the company revealed it would treat its chip manufacturing business, known as Intel Foundry, as a separate project with its own costs and sales.
Intel said that Intel foundry revenue for the quarter was US$4.4 billion, a 10% annual decrease. The unit reported a third-quarter operating loss of $2.5 billion. Intel said last month that its foundry would post an operating loss of $7 billion in 2023.
Intel’s biggest business remains making chips for PCs and laptops, reportedly selling for client computing. Sales of these chips totaled $7.5 billion, a 31% increase from the same period last year.
Intel also makes server CPUs and other parts and software, which is 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 grew 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 graphics processing units, although the processor won’t ship 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.
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