Intel Earnings Top Forecasts; Revenue Outlook Falls Short
Intel reported quarterly earnings that beat analysts' estimates and revenue that met forecasts, but its revenue outlook fell short of expectations on Thursday.
After the fourth-quarter earnings announcement, Intel stock initially ticked higher but later turned negative in extended-hours trading. (Click here to get the latest quotes for the company.)
The chipmaker's net earnings were $2.5 billion, or 48 cents a share, compared with $3.4 billion, or 64 cents a share, in the same quarter last year.
Revenue decreased 3 percent to $13.5 billion from $13.89 billion a year ago as the personal computer industry wrestles with falling sales and a shift toward tablets and smartphones.
Analysts had expected the company to report earnings excluding items of 45 cents a share on $13.53 billion in revenue, according to a consensus estimate from Thomson Reuters.
"The quarter came in as we expected," said Intel CFO Stacy Smith. "When you get under the numbers and look at the driver, for us 2012 was a year where we refreshed our product line across every major business. We're seeing just a ton of innovation by us and our customers. That is what allowed us to come in as expected and set the guidance we did for 2013."
For the first quarter, the company sees revenue of $12.2 to $13.2 billion. This range's midpoint is lower than the consensus estimate of $12.91 billion, according to a consensus estimate from Thomson Reuters.
"My expectation is that as we get into the back half of the year we'll see some acceleration in the market," Smith added. "It will be a combination of GDP improving, which is consistent with what economists are projecting, and then also our product cycles."
PC makers are struggling to stop a decline in sales as consumers hold off on buying new laptops in favor of spending on more nimble mobile gadgets.
Microsoft's long-awaited launch of Windows 8 in October brought touchscreen features to laptops but failed to spark a resurgence in sales that Intel and many PC manufacturers had hoped for.
Intel said its capital spending in 2013 would be $13 billion, plus or minus $500 million, exceeding what many analysts had expected.