Shares Of Intel Fall Following a Weak Forecast For The Current Quarter

(CTN News) – On Thursday, Intel announced first-quarter earnings that exceeded Wall Street expectations in earnings per share, but fell short in sales. This quarter’s forecast was weak.

During extended trading, the stock declined by over 8%.

For the quarter ending in March, Intel performed in line with the consensus expectations of LSEG:

• EPS: 18 cents adjusted vs. 14 cents expected

• $12.72 billion in revenue compared to $12.78 billion expected

On a midpoint basis, Intel expects earnings per share of 10 cents on revenues of 13 billion dollars for the second quarter. This forecast compares with analysts’ estimates of 25 cents per share on $13.57 billion in sales.

This year, Intel reported a net loss of $400 million, or 9 cents per share, compared to $2.8 billion, or 66 cents per share, last year.

It generated $12.7 billion in revenue, compared with $11.7 billion a year ago, an increase of 9% over last year.

In Intel’s report, it was the first since the company revealed it had restructured its financial reports to separate its chip manufacturing business, called Foundry, into its own line item.

During the quarter, Intel’s Foundry business reported $4.4 billion in revenue,

Down 10% from the previous year. It reported an operating loss of $2.5 billion during the quarter ended March 31. Earlier this month, Intel reported that its foundry had suffered an operating loss of $7 billion in 2023.

According to client computing sales, its biggest business remains the manufacture of chips for PCs and laptops. A total of $7.5 billion was sold in chips last year, an increase of 31% over the previous year.

Also, manufactures central processors for servers, as well as other parts and software, which are included in its Data Center and AI business unit. Sales of this product line rose by 5% to $3 billion, despite competition with Nvidia’s AI chips for server dollars.

This month, Intel announced a new AI processor for servers called Gaudi 3, intended to compete with Nvidia’s popular GPUs, although the processor will not be available until later this year. its Gaudi 3 chips are expected to generate more than $500 million in sales in the second half of the year.

Intel executives will hold an earnings conference call at 5 p.m. Eastern Time to discuss the results.

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