Intel beats forecasts but still loses top chipmaker title to Samsung
Intel is trying hard to convince investors that it is a “data company”, not just a chips manufacturer, as it reorients itself towards autonomous cars and the “internet of things”. But its shares jumped as much as 4 per cent on Thursday thanks largely to a strong second-quarter performance in its traditional core market of PC processors.
Intel beat Wall Street’s forecast on the top and bottom line and lifted its outlook for the rest of the year, as the chipmaker saw strong growth in both PCs and servers.
However, Intel’s outperformance on Thursday was not enough to prevent it losing its title as the world’s top chipmaker by revenues to Samsung, which earlier on Thursday reported sales of Won61tn, or around $54bn. Samsung’s growth has come largely from memory chips, where a supply shortage has driven up pricing.
Revenues at Intel were up 9 per cent to $14.8bn in the three months ending in June, compared with the $14.4bn analysts had expected. Growth was 14 per cent after adjusting for the sale of its security division. Its largest division of client computing — which includes PC processors — was up 12 per cent, while its data centre unit gained 9 per cent.
Net income was also ahead of market forecasts, up 23 per cent to $3.5bn, after adjusting for certain items, with earnings of 72 cents per share beating Wall Street’s consensus of 68 cents.
Intel now expects its full-year sales to be about $1bn better than investors had anticipated, at around $61.3bn, and adjusted earnings per share of $3.00.
Brian Krzanich, Intel’s chief executive, said it had been an “outstanding” quarter, driven by new Core X-Series chips that are targeted at videogamers and virtual-reality users, as well as new Xeon processors targeting servers used in artificial intelligence applications.
As part of its transformation, Intel is paying $15bn to acquire Mobileye, a maker of sensors for autonomous vehicles. It expects that deal to close in the third quarter.
Intel’s shares have been largely left behind by the recent tech stock rally, trading slightly down over the year to date before closing at $34.97.
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