Intel needed good news tonight, especially after a 15 percent stock run over the past couple of months alone.
The pressure was on for this company to deliver even amid ever-accelerating optimism into the company's first quarter earnings report.
Intel delivered .
The company reported 43 cents a share on $10.3 billion dollars in revenue, with both categories soundly beating Wall Street estimates, by a nickel a share and almost a half billion dollars. And as you might expect, even though shares were already right at a 52-week high, the rally only built upon itself with Intel shares now comfortably above $23 and closing in on $24.
On top of that, Intel reported 63 percent in gross margins, way above the 61.4 percent analysts expected.
Looking out to the company's second quarter, Intel now anticipates about $10.2 billion, nicely above the $9.7 billion consensus. And beyond that, gross margins, which are already near historic highs, will grow to an astonishing 64 percent in the second quarter.
Net income in this cost-cutting world of ours, has taken a back seat to determining the true health and welfare of companies nowadays. Analysts have been desperate to see topline growth as a way to tell whether spending has returned to the macro economic equation. Intel's report appears to prove that point with an exclamation point of its own.
Intel's report is so good that even rival — such that it is — Advanced Micro Devices is seeing a pop in shares. I point that out because in quarter's past, Intel's good news usually translates into bad news for AMD. And bad news from AMD usually is good news for Intel. Sometimes, if AMD beats Intel to the earnings release punch and the news was bad, some analysts and investors extrapolated that there might be some kind of industry slowdown, even if reality was that AMD's problems were its own. But an AMD rally tonight, amid such a strong report from Intel, suggests that investors are looking at Intel's news a kind of tech industry rising tide.
If Intel's CFO Stacy Smith can strike that balance between being just optimistic enough without letting this rally run away from the company uncontrolled, we could see nice, broad-based sustained growth not just in tech, but in a variety of industries. Intel might merely be the first tech company to report, but it's arguably one of the best bellwethers around. This is a very good report. Let's see what the rest of tech has to say. Google's next , come Thursday.