Intel shares rockets as Q3 result, forecast beats estimates
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The news: Intel shares soared in after-hours trading on the Nasdaq after the chip maker's third-quarter result and outlook for the fourth quarter beat market estimates.
The numbers: Intel shares were last up around 9% in extended trading in New York, having dropped 3.5% during Thursday's session.
Intel reported a net loss of USD16.6 billion ($25.22 billion) for the third quarter, compared with a net profit of about USD300 million in the prior corresponding period.
Group revenue was down 6% year-over-year to USD13.3 billion, but neared the top end of Q3 guidance of between USD12.5 billion and USD13.5 billion.
Revenue in Intel’s client computing group, which includes its PC chips for desktop and laptop computers, fell 7% to USD7.3 billion, compared to an average estimate of USD7.38 billion, according to LSEG data.
Revenue in the company’s contract manufacturing business, or foundry, shrank to USD4.4 billion. Intel reported an adjusted gross margin of 18%, compared with analyst estimates of 37.9%.
However, Q3 revenue from Intel's data centre segment, which includes AI chips, grew 9% to USD3.3 billion, beating analyst estimates of USD3.16 billion.
The company expects revenue to be between USD13.3 billion and USD14.3 billion for the fourth quarter, the midpoint of which is above analysts' average estimate of USD13.66 billion.
The context: California-based Intel has been investing heavily to transform its business to compete with its chipmaking rival Taiwan Semiconductor Manufacturing Co (TSMC).
However, TSMC continues to dominate the market, while Intel Foundry, Intel's new division responsible for its manufacturing operations, experiences further revenue declines.
The sources: Intel earnings release, Reuters
