Chip-making giant Intel Corp. (INTC) weighed in with better-than-expected first-quarter results, and forecast second-quarter revenue that bracketed analyst expectations on Tuesday after the market closed, yet the shares still fell in after-hours trading.
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The Street may have been looking for a more optimistic forecast from the chip bellwether, since the company’s second-quarter results will include the impact of the launch of its first smartphone and a new line of ultra-thin laptops called Ultrabooks powered by the company's Ivy Bridge processor.
Intel forecast second-quarter revenue in the range of $13.1 billion to $14.1 billion; analysts are expecting second-quarter revenue of $13.43 billion. The company also forecast adjusted gross margin of 63% in the second quarter, plus or minus a couple of percentage points, and full-year adjusted gross margin of 65%, plus or minus a couple of percentage points.
The Santa Clara, Calif.-based company posted net income that slipped, compared with last year, to $2.74 billion, or 53 cents a share, compared with year-ago profit of $3.16 billion, or 56 cents a share. On an adjusted basis, earnings rose to 56 cents a share, even with last year’s second-quarter adjusted earnings of 56 cents a share.
Revenue rose to $12.91 billion, up slightly from last year’s second-quarter revenue of $12.85 billion. Gross margin widened to 64%, up from 61.4% in the year-ago quarter.
Revenue fell slightly in all three of the company’s business groups, the PC, Data Center and other Intel Architecture Group.
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The results topped expectations, as the Street had predicted earnings of 50 cents a share on revenue of $12.84 billion, according to analysts polled by Thomson Reuters.
"The first quarter was a solid start to what's expected to be another growth year for Intel," said Paul Otellini, Intel's president and CEO, in a statement. "In the second quarter we'll see the first Intel-based smartphones in the market, ship products based on 22nm tri-gate technology in high volume, and accelerate the ramp of our best server product ever, providing a tremendous foundation for growth in 2012 and beyond."
Shares of Intel rose slightly in Tuesday’s session, up 6 cents to finish the day at $28.47, before retreating 2% following the announcement of results after the bell. Year-to-date, the stock is up 17.4%.