Intel surprised with 4Q outlook

US technology company Intel presented its quarterly results for 3Q 2023. The company managed to beat expectations. The outlook also pleased investors.

Financial results

Revenues fell year-on-year from USD 15.34bn to USD 14.16bn. Cost of sales also saw a year-on-year decline, from USD 8.80 billion to USD 8.14 billion.

Gross margin was USD 6.018 billion. In the same period of 2022, it was USD 6.535 billion. Adjusted gross margin was 45.8%. The market forecast was 43.1%.

Current assets were $43.81 billion at the end of the quarter. Current liabilities amounted to USD 28.61 billion.

Debt increased from USD 37.684 billion to USD 46.591 billion since the beginning of the year.

Adjusted operating margin beat analysts' expectations, reaching 13.6% against expectations of 8.01%.

Intel's 3Q financial results, source.

Intel segments

The Client Computing segment was the largest contributor to revenue, generating revenue of USD 7.867 billion in the past quarter. The market was expecting USD 7.35 billion. This segment manufactures chips and components for personal computers.

Client Computing financial results, source.

Datacenter and Artificial Intelligence segment revenue was USD 3.8 billion in the quarter. Analysts had forecast USD 3.94 billion.

Datacenter and AI segment financial results, source.

The Network and Edge segment generated revenue of USD 1.45 billion against expectations of USD 1.37 billion. In the same period of 2022, it was USD 2.13 billion. This segment deals with edge computing, i.e., IT deployments that are intended to lead to increased availability of applications and data.

Network and Edge segment financial results, source.

4Q Outlook

Intel projects the following for the next quarter:

Revenue of $14.6 billion to $15.6 billion. The market was expecting USD 14.35 billion.

Adjusted earnings per share at $0.44 vs. expectations of $0.31.

Adjusted gross margin at 46.5% versus expectations of 44.2%.

4Q outlook

Dividend

The Company's Board of Directors approved a quarterly dividend of $0.125 per share.

Intel shares

The stock is up 8.24% to $35.20 in pre-market trading. Intel shares are also trading on the RM-SYSTEM, under the ticker BAAINTEC. The last trade was at 810.0 per share.


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