Intel’s turnover was lower than expected in the past quarter, partly due to falling demand for PCs. Sales of Intel’s consumer division fell 25 percent. The company is slashing earnings and revenue forecasts for the remainder of 2022.
Intel’s revenue fell to $15.3 billion last quarter, down 22 percent from the same period in 2021. The chipmaker says that was due to disappointing results from its Client Computing and Datacenter and AI divisions, which target consumers respectively. – and hpc products. Those industries were hit last quarter by “unfavorable market conditions,” the company wrote. The Network and Edge division and MobileEye, an Intel subsidiary that works on self-driving cars, achieved record sales, according to Intel.
Net profit also fell last quarter. Based on results calculated according to the GAAP principles, the company lost $450 million last quarter. The non-gaap results come in at a profit of $1.2 billion. This loss in the GAAP results is partly due to stock reservations for future product releases, which count as a cost item under these American generally accepted accounting principles. Intel also lost $155 million in scaling up its Foundry Services division to produce chips for other companies.
Also contributing is the $559 million write-off Intel had to write off for its Optane division. CEO Pat Gelsinger announced at the presentation of Intel’s quarterly results that the company will discontinue those memory products. The company indicates that it will phase out its Optane activities in the near future.
For the coming quarter, Intel expects revenues between 15 and 16 billion dollars, where it previously forecasted 19.2 billion dollars. For the full year, the company expects revenues of $65 to $68 billion, a decrease of up to 13 percent from previous expectations. The company does expect this to be the low point, and expect margins to rise again in the coming quarters. The company is also looking at ways to reduce spending in the short term. The plans to build new chip factories in the US and Europe do not fall under this, according to the company.