Factors set the tone for Intel (INTC) fourth-quarter earnings-January 18, 2021 | Instant News


Intel (International Trade Centre Free report) Plan to release the 2020 fourth quarter results on January 21, 2021.

At the third quarter financial report conference, management expects PC-centric businesses to fall in low single digits year-on-year, while data-centric businesses are expected to decline by about 25% year-on-year in the fourth quarter.

Intel also expects that, supported by remote work and online trends, the momentum of consumer laptops will continue in the fourth quarter. In addition, increased supply may contribute to the results.

Based on preliminary results released on January 13, the company expects fourth-quarter revenue and earnings per share to exceed previous guidance provided on October 22, 2020.

It is worth mentioning that on January 13, Intel announced that it had appointed Pat Gelsinger as the company’s new CEO. The current CEO Bob Swan (Bob Swan) will step down on February 15, 2021. In addition, the chip maker intends to provide strong progress in its 7 nanometer (nm) process technology at the fourth quarter earnings conference. The latest information.

Main estimates for the fourth quarter

For the fourth quarter, Intel previously estimated non-GAAP revenue of $17.4 billion. The Zacks Consensus Revenue is estimated at $17.44 billion, a decrease of 13.7% from the same period last year.

For the fourth quarter, Intel expects non-GAAP earnings per share of $1.10. The Zacks Consensus estimates that revenue is $1.10, which has been stable for the past 30 days. The data showed a decrease of 27.6% over the same period last year.

It is worth noting that the company has exceeded expected earnings in the past four quarters, with an average of 11.9% unexpectedly.

Precautions

Due to the coronavirus crisis, the entire enterprise and government terminal markets have weak demand for data centers, leading to weak data-centric businesses that may affect Intel’s fourth-quarter performance.

However, driven by the wave of work from home triggered by the coronavirus crisis, the increasing adoption of cloud-based solutions across mobile computing and 5G-based network infrastructure may alleviate the expected decline.

In addition, the wave of work from home and online learning caused by the coronavirus may have boosted the sales of processors used in corporate laptops and data center servers. In turn, this is expected to be reflected in revenue in the fourth quarter.

It is worth noting that Encouraging trends in PC shipments In the fourth quarter, due to increased demand and supply chain improvement, it is likely to contribute to the revenue of Intel’s Customer Computing Division (CCG) division.each IDC dataPC shipments in the fourth quarter of 2020 were 91.6 million units, a year-on-year increase of 26.1%.

In addition, the strong adoption of Xeon processors integrated with Optane DC’s persistent memory solution may help report revenue for the quarter. The strong momentum of 10 nm mobile CPU heralds good development.

In addition, the latest adoption of Core vPro and Lakefield processors and the gradual adoption of Tiger Lake series products may be reflected in the upcoming quarterly revenue.

In addition, higher Wi-Fi and modem sales and strong demand for notebook computers are still a ride.It’s worth noting that Intel’s Optane DC persistent memory modules are being Oracle (ORCL Free report), SAP, Google, Microsoft (Microsoft Free report), Baidu and Alibaba.

In addition, the non-volatile memory business of chip manufacturers may be gained by improving NAND price trends and the growth of Optane bits. Similarly, the growing demand for server solid state drives (SSDs) in data centers has driven the growth of the NAND market, which may benefit the fourth quarter execution.

Nevertheless, Mobileye’s new design wins and the growing popularity of the Internet of Things and the stable automotive industry may have contributed to Intel’s fourth quarter results. Mobileye’s SuperVision Surround View Advanced Driver Assistance System (ADAS) is becoming increasingly influential in high-end electric vehicles (EV).

However, the weakness of the Intel Internet of Things Group (IOTG) terminal market (especially the retail and industrial markets) is likely to affect revenue this quarter.

In addition, the growing influence Advanced Micro Devices‘(AMD Free report) Its second-generation EPYC server processor may bring pricing pressure and limited profit growth.

In addition, the cost of accelerating production of 10-nanometer products and increasing production of 7-nanometer products is expected to put pressure on earnings in the fourth quarter.

Intel currently has a Zacks Rank 4 (for sale).

you can see The full list of today’s Zacks #1 ranking (strong buy) is here.

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