The company projects fourth-quarter revenue between $15 billion and $16 billion alongside an adjusted profit of 25 cents per share, missing expectations. An October explosion at the Kiryat Gat fab in Israel accounts for roughly $300 million of the upcoming revenue deficit and will affect margins into early next year. Sluggish client computing demand also pressured performance, as PC chip sales fell 5 percent during the third quarter. Despite the gloomy forecast, third-quarter revenue managed to climb 21 percent to $16.51 billion to surpass expectations.
Key points
Operational fallout from the factory blast will continue to depress Intel's financial per…: Operational fallout from the factory blast will continue to depress Intel's financial performance into the first quarter of next year.
Persistent weakness in the personal computer market is expected to dampen hardware demand…: Persistent weakness in the personal computer market is expected to dampen hardware demand through at least the first half of next year.
Leadership remains committed to heavily funded expansion plans, having raised $23 billion…: Leadership remains committed to heavily funded expansion plans, having raised $23 billion to boost long-term contract manufacturing capacity.
Sources checked by our analysis pipeline: 1
Oct 29 : Intel forecast quarterly revenue and profit below Wall Street estimates on Thursday, as a factory explosion in Israel and a prolonged slowdown in the PC market offset strong demand for its AI server chips, sending its shares down more than 20 per cent in extended trading.
The guidance could test confidence in a stock that has more than doubled this year, as investors weigh ongoing manufacturing constraints and soft PC demand against strong demand for its AI server chips and efforts to revive growth through a costly foundry expansion.
“Looking ahead, we see the PC slowdown continuing at least through the first half of next year," Chief Financial Officer David Zinsner said. "We will continue making disciplined investments in capacity and working capital to increase supply and support future growth.”
The results also put a spotlight on Intel's funding plans. In August, the company raised $23 billion from an upsized share offering, as it seeks to challenge industry leaders such as TSMC in contract chip manufacturing.
Intel expects fourth-quarter revenue between $15 billion and $16 billion, below…
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