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Intel sign in front of Silicon Valley offices and museum entrance
Andreistanescu / Dreamstime
Strong sales of its PC chips and its Mobileye autonomous driving unit helped
Intel
end a difficult 2020 at a high level.
The Silicon Valley chip maker said fourth-quarter revenue fell from $ 20.21 billion in the same period last year to $ 19.98. However, sales of personal computers were up 9% to $ 10.9 billion, and the company said it sold a record number of notebook chips. Analysts had forecast PC sales of $ 9.57 billion.
Mobileye stood out, with sales increasing about 50% to $ 333 million. “Mobileye is on track to become a more than a billion dollar annual company, a real achievement,” said Patrick Moorhead of Moor Insights and Strategy.
Intel (ticker: INTC) posted fourth-quarter net income of $ 5.9 billion, which equates to $ 1.42 per share, compared to earnings of $ 6.9 billion, or $ 1.58 in the same quarter a year ago. Adjusted for restructuring and acquisition costs, earnings were $ 1.52 per share.
The results were more helpful than Intel’s own sales forecasts for the fourth quarter and exceeded consensus estimates, allowing outgoing CEO Bob Swan to leave the company at a high level.
Intel shares rebounded in the closing minutes of trading on Thursday, rising 6.5% to $ 62.46 after Intel unexpectedly released the results about seven minutes before the end of the trading session.
“We significantly exceeded our expectations for the quarter, ending our fifth consecutive record year,” said Swan. “Demand for computing performance from Intel remains very high and our focus on growth opportunities is paying off.”
Wall Street had expected Intel’s data center chip sales to decline nearly 25% in the fourth quarter, but the company reported revenue of $ 6.1 billion, down 16% from the same period a year ago.
Intel gave investors another reason to cheer, announcing that it increased its 2021 dividend by 5%.
Amid chip shortages around the world that have hampered the production of goods ranging from video game consoles to automobiles, Intel gave optimistic guidance for the first quarter.
The company said it expected non-GAAP earnings of $ 1.10 per share on adjusted sales of $ 17.5 billion. The adjusted revenue excludes flash memory sales of $ 1.1 billion, as the company sold the device to Sk Hynix in late 2020.
Swan will be replaced on February 15 by VMware CEO Pat Gelsinger.
In the conference call late Thursday, Gelsinger said the company will likely continue to make most of its 2023 chips in-house, but said, “We are likely to expand our use of third-party foundries for certain technologies and products.” The upcoming CEO promised a further update as soon as he officially joins the company next month.
Intel stock is up 3.2% in the past year, while the PHLX Semiconductor index is up 64%. The
S&P 500
has increased by 16% in the past year.
Write to Max A. Cherney at [email protected]