Intel CEO Pat Gelsinger holds an artificial intelligence processor as he speaks during the Computex conference in Taipei, Taiwan, on June 4, 2024.
Annabelle Cheh | Bloomberg | Getty Images
Intel Shares rose 9% in extended trading Thursday after the chipmaker reported better-than-expected earnings and issued quarterly guidance that beat estimates.
Here's how the company performed compared to the LSEG consensus:
Earnings per share: 17 cents adjusted vs. expected loss of 2 cents Revenue: $13.28 billion vs. $13.02 billion expected
Intel's revenue fell 6% year over year in its fiscal third quarter, which ended Sept. 28, according to a statement. The company recorded a net loss of $16.99 billion, or $3.88 per share, compared to net profits of $310 million, or 7 cents per share, in the same quarter last year.
As part of its cost-cutting plan, Intel recognized $2.8 billion in restructuring charges during the quarter. There was also $15.9 billion of impairment charges related in part to the accelerated depreciation of Intel 7 processing node manufacturing assets and the impairment of goodwill in the Mobileye unit.
Intel has been mired in an extended recession due to market share losses in its core businesses and an inability to penetrate artificial intelligence. CEO Pat Gelsinger revealed plans this quarter to spin off the company's foundry business into an independent subsidiary, a move that would enable outside financing options.
CNBC reported that Intel has hired consultants to defend itself against activist investors. In late September, news emerged Qualcomm I approached Intel about a potential acquisition.
The consumer computing group that sells PC chips reported $7.33 billion in fiscal third-quarter revenue, down about 7% from a year earlier and below the consensus of $7.39 billion among analysts surveyed by StreetAccount.
Revenue from the Data Centers and AI segment reached $3.35 billion, up ~9% and above the StreetAccount consensus of $3.17 billion.
Intel called for third-quarter adjusted fiscal earnings of 12 cents per share and revenue of between $13.3 billion and $14.3 billion. Analysts had expected 8 cents in adjusted earnings per share on revenue of $13.66 billion.
During the quarter, Intel announced the launch of Xeon 6 server processors and Gaudi AI accelerators.
Gaudi's uptake has been slower than Intel expected and the company will not reach its $500 million revenue target for 2024, Gelsinger said on a conference call with analysts.
As of Thursday's close, Intel shares are down about 57% in 2024, while the S&P 500 is up 20%.
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