Intel Reports Narrower-Than-Expected Q4 Loss
- Posted on January 31, 2025
- Technology
- By Samiat
Key Highlights:
Performance Summary:
Intel (NASDAQ: INTC) reported a narrower-than-expected loss for the fourth quarter, signaling some progress in the chipmaker’s turnaround efforts. Revenue declined 7% year-over-year to $14.3 billion, but it exceeded analyst expectations.
The company reported a net loss of $100 million, or 3 cents per share, compared to a profit of $2.7 billion, or 63 cents per share, in the same period last year. Analysts had expected a much steeper loss of $728 million, or 14 cents per share.
Intel's foundry business, which manufactures chips for other companies, delivered $4.5 billion in revenue, also topping estimates.
Management Commentary:
Interim co-CEOs Michelle Johnston Holthaus and David Zinsner credited the quarterly performance to cost-cutting measures, which they said are starting to yield results. Zinsner added during the earnings call that part of the revenue upside might have been driven by customers hedging against potential tariffs, though this is “difficult to quantify.”
The results mark the first quarterly report since former CEO Pat Gelsinger stepped down last month. Intel has not yet named a permanent successor, sparking speculation about potential candidates for the role.
Takeover Speculation:
Intel has also been the subject of takeover rumors recently. Citi analysts identified Broadcom (NASDAQ: AVGO) as the “most likely” buyer, suggesting that Broadcom might divest Intel's foundry business if a deal materializes.
Guidance and Market Reaction:
For Q1 2025, Intel projected revenue between $11.7 billion and $12.7 billion, falling short of the $12.9 billion analyst consensus. The company also forecasted a wider-than-expected loss of 27 cents per share, compared to analyst expectations of a 13-cent loss.
Zinsner attributed the weaker outlook to seasonal factors, macroeconomic uncertainties, competitive pressures, and ongoing inventory adjustments.
Despite the cautious guidance, Intel shares rose nearly 4% in after-hours trading following the earnings release. However, the stock has lost more than 50% of its value over the past 12 months as of Thursday’s close.
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