Well, it’s that time again — famed chipmaker Intel has just reported its fiscal Q3 2013 earnings and they’re just a bit better than expected. The company reported quarterly revenue of $13.5 billion (which is pretty much flat compared to its performance last year) and earnings of $0.58 per share (again, same as last year).
To put that in a little perspective, the analyst consensus as per Yahoo! Finance was for the company to report $13.47 billion in revenue for the quarter, along with earnings of $0.53 per share. It’s not the biggest beat you’ll ever see (Intel CEO Brian Krzanich said this quarter saw “modest growth in a tough environment”), but it’s a beat nonetheless.
Still, that’s not to say everything is downright peachy in Intel’s world. Industry analysis firm Gartner said that global PC sales were down 8.6 percent this past quarter, making the sixth consecutive quarter of decline. Granted, that’s not as big a dip what we saw last quarter, but it’s further proof that the traditional PC market isn’t done contracting just yet. That shift is reflected in the performance of the company’s PC Client group, which raked in a respectable $8.4 billion in Q3… though it’s still down some 3.5 percent year-over-year. As such, it’s no surprise to see Krzanich point out the fact that Intel is steadily increasing its focus on “ultra-mobile devices and 2 in 1 systems.”
This is also one of the first quarters where we’re getting to see what sort of impact Intel’s new Haswell chips are having — they’re already seeing widespread use in devices across OEM borders, especially in devices that seek to bridge the performance gap between more traditional PCs and newfangled ultraportable designs like Ultrabooks and Surface-esque tablets. As it happens, Haswell has helped the situation somewhat but perhaps not as much as Intel had hoped right now. To quote CFO Stacy Smith from his commentary addendum, “the worldwide PC supply chain saw a small increase in inventory levels in the third quarter as customers continued to build inventory of Haswell based PCs but inventory levels are still being managed well below historical averages.” Fortunately, things looked a little brighter for the company’s Data Center group as it saw revenues surge just over 12 percent since last year.
All in all, this has been a solid (if admittedly unremarkable) quarter for Intel, and the company’s share price has surged slightly in after-hours trading as a result. What’s really interesting here though is that Intel has offered up some guidance for the next quarter which is lower than what analysts had previous called for, but we’ll tackle that when the time comes. For now, I’ll be sitting in on the customary earnings call in just a few moments and will update this post with any interesting tidbits that come up.
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