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Intel Reports Second Quarter 2013 Results

Intel

Intel reported second-quarter revenue of $12.8 billion, operating income of $2.7 billion, net income of $2 billion and earnings per share of 39 cents. The company generated approximately $4.7 billion in cash from operations, paid dividends of $1.1 billion, and used $550 million to repurchase 23 million shares of stock.

Brian Krzanich (CEO, Intel):  In my first two months as CEO, I have listened to a wide variety of views about Intel and our industry from customers, employees and my leadership team and I am more confident than ever about our opportunity as a company.  Looking ahead, the market will continue buying a wide range of computing products .  Intel Atom and Core processors and increased SOC integration will be Intel’s future. We will leave no computing opportunity untapped. I’ve made it Intel’s highest priority to create the best products for the fast growing ultra-mobile market segment.”

Intel Q2 Key Financial Information and Business Unit Trends

  • PC Client Group revenue of $8.1 billion, up 1.4 percent sequentially and down 7.5 percent year-over-year.
  • Data Center Group revenue of $2.7 billion, up 6.1 percent sequentially and flat year-over-year.
  • Other Intel Architecture Group revenue of $942 million, down 3.7 percent sequentially and down 15.0 percent year-over-year.
  • Gross margin of 58 percent, up 2 percentage points sequentially and down 5 percentage points year-over-year.
  • R&D plus MG&A spending of $4.7 billion, in line with the company’s expectation of approximately $4.7 billion.
  • Tax rate of 26 percent.

Business Outlook

Intel’s business outlook does not include the potential impact of any business combinations, asset acquisitions, divestitures or other investments that may be completed after July 17.

Q3 2013

  • Revenue: $13.5 billion, plus or minus $500 million.
  • Gross margin percentage: 61 percent, plus or minus a couple of percentage points.
  • R&D plus MG&A spending: approximately $4.8 billion.
  • Amortization of acquisition-related intangibles: approximately $70 million.
  • Impact of equity investments and interest and other: approximately $400 million net gain.
  • Depreciation: approximately $1.7 billion.

Full-Year 2013

  • Revenue: Approximately flat year-on-year, down from prior expectations of low single digit percentage increase.
  • Gross margin percentage: 59 percent, plus or minus a couple percentage points, down from prior expectations of 60 percent, plus or minus a few of percentage points.
  • R&D plus MG&A spending: $18.7 billion, plus or minus $200 million, down $200 million from prior expectations.
  • Amortization of acquisition-related intangibles: approximately $300 million, unchanged from prior expectations.
  • Depreciation: $6.8 billion, plus or minus $100 million, unchanged from prior expectations.
  • Tax Rate: approximately 26 percent for each of the remaining quarters of the year.
  • Full-year capital spending: $11.0 billion, plus or minus $500 million, down $1.0 billion from prior expectations.

[Image courtesy: Intel]

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