Chipset-making giant Intel Corp posted its first quarter (Q1) earnings, barely beating analysts' expectations while reporting the largest quarterly loss in the company's history, the media has reported. Intel's earnings were above Wall Street estimates on Thursday, in a sign that chip demand was recovering after a slowdown by excess supply and a post-Covid-19 pandemic slump in the personal computer market.
The company has also ramped up the shipping of its most powerful data centre chip Sapphire Rapids, which was delayed for over a year, news agency Reuters reported.
The US chipset-making major is struggling with a steep decline in both PC and data centre sales, amid a pullback from consumers and businesses on spending. PC revenue was off a whopping 38 per cent in the quarter, while data centre revenue fell 39 per cent.
Intel's Q1 results showed a staggering 133 per cent annual reduction in earnings per share while revenue dropped nearly 36 per cent year over year (YoY) to $11.7 billion, says a report by CNBC.
For the next quarter, the chip maker expects to lose 4 cents per share on revenue of $12 billion. That forecast is shy of analyst expectations for earnings of 1 cent per share on $11.75 billion in sales, according to Refinitiv, the CNBC report added.
Earlier in February, the US chipmaker started the pay of management across the company to cope with the shaky economy and preserve cash, news agency Bloomberg had reported. The company had said that it is making several adjustments to employee compensation and rewards to reduce costs. According to the report, Intel’s CEO Pat Gelsinger started taking a 25 per cent cut to his base salary.
Earlier, Intel reported a revenue decline of 32 per cent year-on-year (YoY) in the quarter that ended December 31. It was the fourth consecutive quarter of falling sales for chipmakers. The company recorded a $664 million net loss, compared with a profit of $4.62 billion in the year-ago quarter. Stiff competition and a sharp slowdown in personal computer demand have wiped out profits and eaten into Intel’s cash reserves.