Side Business Over Main Job... Intel Smiles at Unexpected Strong Earnings

U.S. semiconductor company Intel saw its revenue decline again in the third quarter of this year, marking the seventh consecutive quarter of shrinking sales.

On the 26th (local time), Intel announced in its earnings report that its earnings per share (EPS) for the third quarter reached $0.41, an 11% increase compared to $0.37 in the same period last year. This figure is roughly double the market expectation of $0.22.

During the same period, revenue fell 8% year-over-year to $14.16 billion (approximately 19.2363 trillion KRW), continuing the downward trend for seven consecutive quarters since the first quarter of last year. However, this exceeded the market expectation of $13.53 billion.

[Image source=Reuters Yonhap News]

The better-than-expected performance was driven by Intel’s autonomous driving and foundry subsidiaries, which are considered future growth engines. Intel’s autonomous driving subsidiary, Mobileye, posted third-quarter revenue of $530 million, a surprising 18% increase compared to the same period last year. Intel Foundry Services achieved a remarkable 300% year-over-year growth with $311 million in revenue.

However, the core personal computer (PC) segment continued to struggle, with revenue declining 3% to $7.9 billion. To address the deterioration in performance and financial structure caused by the core business slump, Intel is focusing on cost-cutting efforts. The company stated that operating expenses in the third quarter decreased by about 15% compared to the same period last year. Intel CEO Pat Gelsinger emphasized, "We plan to achieve approximately $3 billion in cost savings for the entire year."

The company set its revenue guidance for the fourth quarter at $14.6 billion to $15.6 billion, expecting to break the trend of shrinking sales in the fourth quarter. The midpoint of this range, $15.1 billion, surpasses the market expectation of $14.31 billion. However, the earnings per share are projected to be $0.23, which is lower than the market expectation of $0.32.

The market responded enthusiastically to the stronger-than-expected results. Intel’s stock, listed on the Nasdaq, surged over 7% in after-hours trading following the release of the strong earnings report. During regular trading hours, Intel closed at $32.52, down 0.94% from the previous day.

This content was produced with the assistance of AI translation services.