Intel Q2 Profit Rises - Update

(RTTNews) - Intel Corp. (INTC), the world's biggest chipmaker, Thursday reported an increase in profit for the second quarter that also trumped Wall Street estimates, as revenues grew 15 percent.

Santa Clara, California-based Intel's second-quarter profit rose to $5.0 billion or $1.05 per share from $2.8 billion or $0.58 per share last year.

Adjusted earnings for the quarter were $1.04 per share, up from $0.72 per share. On average, 32 analysts polled by Thomson Reuters estimated earnings of $0.96 per share for the quarter.

Intel's revenues for the quarter rose 15 percent to $17.0 billion from $14.8 billion last year. Analysts had a consensus revenue estimate of $16.76 billion for the quarter.

Revenue growth was driven by strength across the business and customer demand for performance-leading Intel platforms, the company said in a statement. Data-centric businesses grew 26 percent, approaching 50 percent of total revenue, while PC-centric revenue was up 6 percent.

Intel, popular for its chips for computers, now focuses to transition away from being a computer-based company to a company that "powers the cloud and billions of connected computing devices."

Intel sees data center and Internet of Things (IoT) businesses as its primary growth engines, which now contributed a significant chunk of revenues and operating profit, helping it mask negative effects from the PC segment.

Client computing group revenues were up 6 percent to $8.7 billion, while data center segment revenues grew 27 percent to $5.5 billion and Internet of Things unit rose 22 percent to $880 million. Non-volatile Memory Solutions Group rose 23 percent to $1.1 billion and Programmable Solutions Group revenues grew 18 percent to $517 million.

CFO Bob Swan said, "Intel is now competing for a $260 billion market opportunity, and our second quarter results show that we're winning. As a result of the continued strength we are seeing across the business, we are raising our full year revenue and earnings outlook."

Looking forward to the third quarter, Intel expects revenues of $18.1 billion, plus or minus $500 million. Analysts currently estimate revenues of $17.65 billion.

For the full year 2018, Intel now expects revenues of $69.5 billion, plus or minus $1.0 billion. Earlier, the company predicted revenues of $67.5 billion. Analysts currently estimate earnings of $68.43 billion.

INTC closed Thursday's trading at $52.16, down $0.27 or 0.51%, on the Nasdaq. The stock further slipped $2.31 or 4.43% in the after-hours trade.