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Intel Stock Fell as Chip Maker cut Revenue Forecast

Collectively, Intel’s data-centric businesses declined 5 per cent (YoY) in the first quarter

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Intel
This Jan. 1, 2018, file photo shows an Intel logo on the box containing an HP desktop computer on sale at a Costco in Pittsburgh. VOA

Intel stock plunged nearly 7 per cent on slashed revenue forecast for the full year and a flat first-quarter revenue at $16.1 billion.

Its data-centric revenue declined five per cent while PC-centric revenue grew 4 per cent in the first quarter of 2019, the chip-maker said in a statement on Thursday.

Net income was $4 billion — down from the same quarter last year which reported $4.5 billion.

The company expects full-year revenue of $69 billion, down from the January guidance.

“Results for the first quarter were slightly higher than our January expectations. Looking ahead, we’re taking a more cautious view of the year, although we expect market conditions to improve in the second half,” said Bob Swan, Intel CEO.

The company said it shipped a strong mix of high-performance products and continued spending discipline while ramping 10nm chip and managing a challenging NAND flash memory pricing environment.

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intel technology. Pixabay

“We aim to capitalize on key technology inflections that set us up to play a larger role in our customers’ success, while improving returns for our owners,” said Swan.

Intel said last week ita¿s exiting the 5G smartphone market after determining there was “no clear path to profitability”.

In the first quarter, the company generated approximately $5 billion in cash from operations, paid dividends of $1.4 billion and used $2.5 billion to repurchase 49 million shares of stock.

The PC-centric business (CCG) was up in the first quarter due to a strong mix of Intel’s higher performance products and strength in gaming, large commercial and modem.

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“Intel’s first high-volume 10nm processor, code-named Ice Lake, remains on track to be in volume systems on retail shelves for the 2019 holiday selling season,” said the company.

Collectively, Intel’s data-centric businesses declined 5 per cent (YoY) in the first quarter.

In the Data Center Group (DCG), the cloud segment grew 5 per cent while the communications service provider segment declined 4 per cent and enterprise and government revenue declined 21 per cent. (IANS)

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Apple Wanted to Buy Intel’s Phone-modem Chip Business: Report

Intel had been working on a chipset for the iPhone maker, with the chip expected to be part of iPhones by 2020

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Apple, women
The Apple logo is shown outside the company's Worldwide Developers Conference in San Francisco, California. VOA

Apple held talks with chip-maker Intel about acquiring its smartphone-modem chip business in a multi-billion dollar deal to ramp up the development of wireless technology for iPhones, the media reported.

According to a report in The Wall Street Journal on Friday, the two companies were in talks since last year, though those conversations have now “stalled.”

Apple has been working on its own chips for quite some time. Acquiring Intel’s technology could have helped the iPhone maker accelerate its plans.

“Intel is now exploring strategic alternatives for its modem chip business, including a possible sale,” the report added.

The chip-maker has received expressions of interest from a number of parties and has hired Goldman Sachs to manage the process.

Intel
This Jan. 1, 2018, file photo shows an Intel logo on the box containing an HP desktop computer on sale at a Costco in Pittsburgh. VOA

Intel has confirmed the “surprise” settlement between Qualcomm and Apple pushed it to exit the mobile 5G race.

“In light of the announcement of Apple and Qualcomm, we assessed the prospects for us to make money while delivering this technology for smartphones and concluded at the time that we just didn’t see a path,” said Bob Swan, Intel CEO.

Intel on April 16 said it plans to cease working on modems for 5G, the next-generation of wireless technology expected to supercharge mobile connections.

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The news that Intel had exited the 5G modem business came barely hours after the Qualcomm-Apple agreement was announced.

Intel had been working on a chipset for the iPhone maker, with the chip expected to be part of iPhones by 2020. (IANS)