Intel reported better-than-expected earnings and revenue for the fourth quarter, but its outlook disappointed investors. Despite a 7% year-over-year revenue decline, the company exceeded analyst estimates with adjusted earnings per share of 13 cents and revenue of $14.26 billion. Shares rose 3% in after-hours trading following the announcement.
The company posted a net loss of $126 million, or 3 cents per share, compared to a net income of $2.67 billion in the same quarter last year. This marks Intel’s first earnings report since announcing the departure of CEO Pat Gelsinger. In his tenure, Gelsinger struggled to maintain market share, fell behind in AI advancements, and committed significant investments toward manufacturing plants. Intel appointed interim co-CEOs David Zinsner and Michelle Johnston Holthaus while the search for a permanent replacement continues.
The company revised its AI strategy, shifting focus from its Falcon Shores processor, originally intended for servers, to a new product called Jaguar Shores aimed at a broader AI data center market. Management cited industry feedback in the decision to use Falcon Shores as a test chip rather than a commercial product.
Intel’s guidance for the first quarter projects breakeven profitability, with revenue between $11.7 billion and $12.7 billion, below analyst expectations. The company attributed this outlook to economic conditions, seasonality, inventory adjustments by clients, and potential tariff concerns.
The Client Computing Group, responsible for PC chips, generated $8.02 billion in revenue, a 9% decline from the previous year but still above expectations. Intel’s Data Center and AI segment reported $3.39 billion in revenue, down 3%, while the Network and Edge unit saw a 10% increase to $1.62 billion.
During the quarter, Intel secured a $7.86 billion U.S. government grant to support manufacturing across four states. The company expects volume chip production on its advanced 18A process technology to begin in the second half of 2025. Additionally, next-generation laptop chips, codenamed Panther Lake, are scheduled for launch later this year.
Intel is also progressing on a potential sale of at least a minority stake in its Altera business, which specializes in field-programmable gate array chips. The company acquired Altera for $14.5 billion in 2015 and expects to provide an update on the transaction by the next earnings call.
While Intel’s shares declined 1% for the year, the company remains focused on restructuring its AI and semiconductor strategy to drive long-term growth.
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