Intel (INTC, $36.31) disappoints on Q2 revenue and full-year outlook
Intel reported its second quarterly earnings that heavily fell short of analysts’ expectations. The tech giant’s outlook for the full-year is also weaker than the Street estimates.
Adjusted earnings came in at 29 cents per share, well below the 70 cents per share expected by analysts polled by Refinitiv.
Revenue decreased 22% from the year-ago quarter to $15.32 billion. It fell short of analysts' expectations of $17.92 billion -- the 14% miss is the company’s largest since 1999, according to Refinitiv data. It has a $454 million net loss as of the quarter’s end, compared with net income of $5 billion in the year-ago quarter.
CEO Pat Gelsinger attributed the weak performance primarily to the “sudden and rapid decline in economic activity” but also mentioned the company’s internal execution issues in areas like product design, and the ramp of AXG [Accelerated Computing Systems and Graphics Group] offerings.
For the third quarter, Intel is expecting 35 cents in adjusted earnings per share, much lower than the 86 cents that analysts polled by Refinitiv expected. The company offered its guidance on revenue at $15 billion to $16 billion, vs. analysts’ $18.62 billion.
Looking further ahead, Intel lowered its full-year outlook on adjusted earnings to $2.30 per share (vs. $3.60 in prior guidance from 3 months ago). It predicts revenue in the range of $65 billion to $68 billion, vs. previous expectation of $76.0 billion in revenue. Analysts polled by Refinitiv were expecting $74.34 billion in revenue.
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Notable companies
The most notable companies in this group are NVIDIA Corp (NASDAQ:NVDA), Taiwan Semiconductor Manufacturing Company Ltd (NYSE:TSM), Broadcom Inc. (NASDAQ:AVGO), Advanced Micro Devices (NASDAQ:AMD), QUALCOMM (NASDAQ:QCOM), Texas Instruments (NASDAQ:TXN), Applied Materials (NASDAQ:AMAT), Intel Corp (NASDAQ:INTC), Lam Research Corp (NASDAQ:LRCX), Micron Technology (NASDAQ:MU).
Industry description
The semiconductor industry manufacturers all chip-related products, including research and development. These chips are used in innumerable electronic devices, including computers, cell phones, smartphones, and GPSs. Intel Corporation, NVIDIA Corp., and Broadcomm are some of the prominent players in this industry. Semiconductor companies usually tend to do well during periods of healthy economic growth, thereby inducing further research and development in the industry – which in turn augurs well for productivity and growth in the economy. In the near future, demand for semiconductor products (and possibly innovation within the segment) should only expand further, with the proliferation of 5G, autonomous vehicles, IoT, and various AI-driven electronics set to herald a new, advanced chapter in the technology-driven world as we know it. With burgeoning prospects comes great competition. In 2015, SIA estimated that U.S. semiconductor industry ranks as the second most competitive U.S. industry out of 2882 U.S. industries designated manufacturers by the U.S. Census Bureau.
Market Cap
The average market capitalization across the Semiconductors Industry is 46.09B. The market cap for tickers in the group ranges from 13.43K to 2.76T. NVDA holds the highest valuation in this group at 2.76T. The lowest valued company is CYBL at 13.43K.
High and low price notable news
The average weekly price growth across all stocks in the Semiconductors Industry was -3%. For the same Industry, the average monthly price growth was -1%, and the average quarterly price growth was 1%. QNCCF experienced the highest price growth at 30%, while MXL experienced the biggest fall at -43%.
Volume
The average weekly volume growth across all stocks in the Semiconductors Industry was 12%. For the same stocks of the Industry, the average monthly volume growth was 19% and the average quarterly volume growth was -0%
Fundamental Analysis Ratings
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
Valuation Rating: 58
P/E Growth Rating: 48
Price Growth Rating: 58
SMR Rating: 70
Profit Risk Rating: 62
Seasonality Score: 6 (-100 ... +100)