On Thursday, Intel Corp. (INTC) released its third-quarter earnings after the market closed.
- Net Revenue: $19.2 billion
- EPS: $1.67
- Net Income: $6.8 billion
Other significant details:
- Third-quarter GAAP revenue of $19.2 billion, up 5% year over year (YoY), and non-GAAP revenue of $18.1 billion, up 5% YoY.
- Achieved all-time record revenue in Intel’s Internet of Things Group (IOTG) and record thirdquarter revenue in the Data Center Group (DCG) and Mobileye businesses.
- Third-quarter GAAP earnings-per-share (EPS) was $1.67; non-GAAP EPS was $1.71, which exceeded Julyguidance by $0.61. Exceeded July guidance for EPS and gross margin.
- Raising full-year 2021 EPS and gross margin guidance. Now expecting GAAP EPS of $4.50 and non-GAAP
- EPS of $5.28 and GAAP gross margin of 55% and non-GAAP gross margin of 57%1.
- Intel CFO George Davis announced plans to retire in May 2022.
“Q3 shone an even greater spotlight on the global demand for semiconductors, where Intel has the unique breadth and scale to lead. Our focus on execution continued as we started delivering on our IDM 2.0 commitments. We broke ground on new fabs, shared our accelerated path to regain process performance leadership, and unveiled our most dramatic architectural innovations in a decade. We also announced major customer wins across every part of our business.We are still in the early stages of our journey, but I see the enormousopportunity ahead, and I couldn’t be prouder of the progress we are making towards that opportunity.”said Pat Gelsinger, Intel CEO
While the analysts had estimated Intel’s performance for the third quarter, the company also published its forecast. The analysts had predicted that Intel, on average, will have adjusted earnings of $1.11 a share, similar to a year back. Intel’s forecast stated $1.10 a share.
Wall Street expected revenue of $18.24 billion from Intel. Intel predicted its revenue to be $18.2 billion.
The Zacks Consensus Estimate for revenues was at $18.22 billion.
Intel has beaten earnings estimates in each of the trailing four quarters, the average surprise being 20.18%
Intel Corp. (INTC) earnings had increased the most this year, taking the first quarter EPS at $1.52. The earnings for the other two quarters were a bit consistent at $1.39 and $1.52 respectively.
The revenue in the previous quarter was reported at $18.53 billion, while the revenue for this quarter the last year was $18.33 billion.
The Road Ahead
Just before the third-quarter earnings release, Apple further drifted away from the chip-maker. Apple ($AAPL) launched two new MacBook Pro models, but they don’t have the intel chip. The newly launched MacBooks come with more powerful in-house chips. This has further increased the rift between Apple and its previous chip supplier, Intel Corp. (INTC).
Recently, in the first in-person keynote, Intel’s new CEO, Pat Gelsinger, made predictions about semiconductor consumption. The semiconductors will account for more than 20% of the total premium vehicle bill of materials (BOM) by 2030. The prophecy speaks of a staggering growth rate of 5x over the actual 4% figures in 2019. The CEO called it ‘the digitization of everything. He expects the total addressable market (TAM) for automotive semiconductors to nearly double by the end of the decade to $115 billion, thereby accounting for more than 11% of the entire silicon TAM.