Intel’s Q1 PC Revenue May Be Halved Due To Dismal Chip Demand

(CTN News) – According to analysts, Intel Corp. (INTC), one of the world’s biggest chipmakers by market value, is likely to report in the second half of the year that its personal computing revenue has halved from the first quarter of last year due to inflation and a slowdown in the tech sector.
Analysts’ estimates compiled by Visible Alpha predict that Intel’s revenue will plunge nearly 40% to $11.1 million in the current quarter, a fall of almost 40% from last year.

For the quarter ended June 30, the firm’s personal computing unit, which is the company’s largest source of revenue, is expected to report a drop in sales of more than 48 percent.

In consequence, Intel’s earnings are expected to swing from a net income of $8.1 billion, or $0.87 a share, in the prior-year quarter, to a net loss of over $2.2 billion in the current quarter, or adjusted earnings per share (EPS) of -$0.18. Intel will announce its earnings after markets close on Thursday.

Intel’s revenue decline provides a good example of how the broader microchip industry is facing a number of challenges, including rising costs, unstable demand, and persistent supply imbalances, which are affecting the broader industry.

A total of $19.67 billion was spent by U.S. consumers on electronics and appliances during the first quarter of this year, down by 5.3% from last year’s first quarter.

Consumers spent less at electronics stores (2.5% less than last year) and gas stations (-4.5%) than they did during the same period last year, which was the only type of retail location where spending was lower.

Specifically, consumer and corporate spending on PCs is expected to be 29% lower in the first quarter of this year as compared to the same period last year.

Ben Bajarin, an analyst at Creative Strategies, told The Financial Times that it’s been pretty much the worst PC year on record so far.

Despite that, Intel continues to increase its product offerings in order to boost waning sales of its products. In the first quarter of this year, the company released a new line of Xeon Scalable processors as well as the 13th Generation Intel Core mobile processor.

The shares of Intel have slipped by 37% over the past year, while the benchmark S&P 500 Information Technology Sector Index has remained relatively unchanged over the same period.

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