- As expected following its guidance hike, Intel's PC Client Group sales staged a turnaround in Q2, growing 6% Y/Y to $8.7B (63% of revenue) after falling 1.5% in Q1. Rising margins helped its op. profit grow 41% to $3.7B.
- Data Center Group (server CPU) sales +19% to $3.5B after growing +11% in Q1. Op. profit +40% to $1.82B.
- Notebook volumes +9% Y/Y, but ASPs -7%. Desktop volumes +8%, ASPs +2%. Data center platform volumes +9%, ASPs +11%.
- Internet of Things (embedded product) sales +24% to $539M, op. profit +26% to $155M. Software/services sales +3% to $548M, op. profit was just $8M vs. a $1M loss a year ago.
- The Mobile & Communications Group (mobile processors, baseband chips, Wi-Fi, and Bluetooth) remains a cash sinkhole: Revenue was officially just $51M due to contra revenue payments, and net loss was $1.12B (up from $761M a year ago). Losses should narrow as contra payments decline, but are expected by the Street to remain sizable for a while.
- Sales from the "All Other" segment (covers flash memory and foundry, as well as one-time charges) rose 16% to $517M, but the segment also saw a $756M op. loss, up from $590M a year ago.
- Gross margin is expected to receive a boost in Q3 from lower unit costs and higher volumes, and to be pressured by lower ASPs.
- With huge buybacks on the way, Intel ended Q2 with $17.3B in cash/investments ($11.2B offshore), and $13.2B in debt.
- INTC +4.2% AH. Prior coverage.
China Stock Roundup: Baidu Partners Intel to Enhance Video Platform, China Mobile Garners 90M 4G Subscribers - Analyst Blog
at Zacks.com (Jan 22, 2015)