Shares of Intel decline when the company issues a cautious outlook for the current quarter

Chipmaker Intel to close a $25 billion factory in Israel
Chipmaker Intel to close a $25 billion factory in Israel

Intel disclosed first-quarter earnings that were lower than Wall Street’s projected earnings per share but with relatively weak sales. Intel’s current quarter forecast was not too optimistic.

Intel released its first-quarter earnings on Thursday, which came in lower than expected in terms of earnings per share for Wall Street, but with very weak sales. Intel’s current quarter forecast was not too optimistic.

Through extended trading, the stock dropped 8%.

In comparison to LSEG consensus forecasts, Intel performed as follows during the March-ending quarter:

Earnings per share: adjusted at 18 cents compared to expected at 14 cents

Revenue: $12.72 billion as opposed to the anticipated $12.78 billion

Intel projects earnings per share for the second quarter of $10 on $13 billion in midpoint revenue. In contrast, experts had predicted that the $13.57 billion in revenues would yield 25 cents per share in earnings per share.

Revenue increased by 9% to $12.7 billion from $11.7 billion in the previous year.

During an earnings call, Intel CEO Pat Gelsinger advised investors to concentrate on the company’s long-term prospects.

He said that his company, along with two or three others worldwide, is the only one capable of advancing next-generation semiconductor technologies.

This was the first quarterly earnings report the corporation has released after disclosing that it had separated its chip manufacturing division, known as Intel Foundry, into a separate line item with its own expenses and revenue.

According to the business, Intel Foundry’s $4.4 billion in revenue for the quarter represented a 10% decrease from the previous year. For the March quarter, the division declared an operating loss of $2.5 billion. Intel said this month that its foundry experienced an operational loss of $7 billion in 2023.

Sales of chips for PCs and laptops, or client computing, continue to be Intel’s largest business. The $7.5 billion in semiconductor sales represented a 31% increase over the previous year.

Along with other components and software, Intel also manufactures server central processors, which are accounted for under its Data Center and AI businesses. Sales of that line increased by 5% to $3 billion, despite Intel’s ongoing battle for server funding against artificial

Intel said earlier this month that it will sell the Gaudi 3, a new AI processor designed to rival Nvidia’s well-liked graphics processing units in servers. However, the Gaudi 3 is not expected to ship until later this year. In the second half of the year, Intel predicted that sales of its Gaudi 3 chips would exceed $500 million.

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