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The Intel share diminishes disappointing earnings prospects when new CEO describes & # 39; more cautiously & # 39; trend



Intel Corp. shares fell as much as 9% in the extended session Thursday after the chip giant's outlook fell far below Wall Street estimates, offset a earnings rate, and a decline in data center revenue was worse than expected.

Intel

INTC, -1.89%

said it expects adjusted earnings of 89 cents in revenue of about $ 15.6 billion in the second quarter, while analysts asked by FactSet had expected earnings of $ 1.01 billion. For the year, the chip producer sees earnings of $ 4.35 per year. Share on revenue of about $ 69 billion. Analysts were expecting $ 4.50 a. Share of DKK 71

.04 billion Dollars.

"Our conversations with customers and partners across our PC and data-centric businesses over the past few months have made several trends clear," said CEO Bob Swan on conference calls.

"The decline in memory pricing has intensified, the data center inventory and the capacity digest that we described in January are more pronounced than expected, and China's headwinds have risen, leading to a more cautious IT spending environment," Swan says. "And yet, the same customer calls strengthen our confidence that demand will improve in the second half."

The company reported net revenue of 3.97 billion. Kr. Or 87 cents a. Share compared to DKK 4.45 billion. share in years ago. Adjusted earnings were 89 cents a share. Revenue fell to DKK 16.66 billion. USD from $ 16.07 billion USD in the quarter for the quarter. Analysts had expected adjusted earnings of 87 cents in revenue of DKK 16.03 billion. USD, according to FactSet.

However, revenue from the data center fell more than expected, 6% to $ 4.99 billion. As analysts expected a fall of 2.5% to $ 5.1 billion. according to FactSet data. The company said sales of bullet segments grew by 5%, but sales of communications service providers declined 4%, and corporate and government revenue fell 21%.

Intel's largest segment, client computers, or traditional PCs increased 4% to $ 8.6 billion. USD, while Wall Street forecast an increase of 1.9% to $ 8.38 billion from a year ago.

At the request, George Davis, Intel's new finance manager, said the company expects quarterly data center sales to be flat in order and PC segment sales to fall in the high single digits. Analysts were expecting data center sales at $ 5.58bn. For the second quarter and sales of PC segments of $ 8.68 billion.

Turnover of volatile memory solutions fell 12% to $ 915 million. In the first quarter, while Wall Street had expected a 9.4% drop to $ 942.1 million. On the other hand, the "Internet of Things" or IoT revenue increased by 8% to $ 910 million. In the first quarter, while analysts had expected a 6% decline to 789.5 million. $.

Intel shares fell by 9% in immediate demand -hours trading, after a 1.9% decline to close the regular session of $ 57.61. For comparison, the PHLX Semiconductor Index is

SOX, -1.81%

completed 1.8%, breaking a six-session record record closures.

On the wider market, the Dow Jones Industrial Average

DJIA, -0.51%

dropped 0.5% Thursday, S & P 500 index

SPX, -0.04%

decreased less than 0.1% and the Nasdaq Composite Index

+ 0.21%

increased 0.2%.

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