Shares of Intel (INTC) are trading 7% higher after the microchip and semiconductor company issued third-quarter financial results that beat Wall Street forecasts.
Intel reported earnings per share (EPS) of $0.41 U.S. versus $0.22 U.S. that had been expected among analysts who track the company’s progress.
Revenue in Q3 amounted to $14.16 billion U.S. versus $13.53 billion U.S. that was expected. The company’s gross margin for the quarter was 45.8%, which was flat from a year earlier.
Intel’s revenue for the quarter was 8% lower than a year ago, marking the seventh consecutive quarter of declining sales.
However, company executives said on an earnings call that they expect positive revenue growth in the current fourth quarter of the year.
Intel executives also reiterated plans to cut costs by $3 billion U.S. this year. The company’s operating expenses declined 15% in Q3 from a year ago.
Sales in Intel’s Client Computing group, which includes laptop and PC processor shipments, were down 3% to $7.9 billion in Q3.
Intel’s Data Center and AI division, which produces server chips, saw sales decline 10% to $3.8 billion U.S.
The company’s foundry services unit, which is Intel’s chip-manufacturing business, remains a small part of its overall business, recording just $311 million U.S. in revenue during Q3.
However, the foundry business’ sales grew nearly 300% from a year ago. Intel’s management team said that the company is on track to catch up with Taiwan Semiconductor Manufacturing Co.’s (TSM) chipmaking technology by 2025.
In terms of forward guidance, Intel said that for the current fourth quarter of 2023, it expects earnings of $0.23 U.S. per share on revenue of $14.6 billion U.S. to $15.6 billion U.S.
Analysts had EPS of $0.32 U.S. and revenue of $14.31 billion U.S. penciled in for the company’s Q4 results.
Prior to today (Oct. 27), Intel’s stock had risen 24% over the past 12 months to trade at $32.52 U.S. per share.
