Corporate Refresh Supports Intel Corporation (INTC); Momentum To Continue

This time Intel Corporation (NASDAQ:INTC) has succeeded to pass on the message that the weakness in the PC industry is almost over as the company reported a robust second quarter results. Though a major portion of its revenue is still contributed by the business buyers, the company is hopeful that consumers too will soon show significant interest in the PCs.


CNBC has discussed a statement of Intel Corporation (NASDAQ:INTC)’s CEO, Brian M. Krzanich, outlining his views over the factors driving the business.

Krzanich said, “It’s driven by the big  firm factors, the 400 or the 600 million systems four years or older, new price points and window xp in the life end. So all of those things are coming together to drive this.”

Krzanich said that the company believes the corporate PC refresh to last till the end of the current year, and so they have built it in their forecast for this year. Also, Krzanich said that the impact of ramp up in its chips production reflect into the company’s fourth quarter gross margins.

Though the company has not reported any major attention from the consumer segment, but they are expecting the new chips will be able to record some success this year, particularly, the developed markets.According to a rough estimate of business revenues split between business and consumers, Intel Corporation (NASDAQ:INTC) projects that 60% of it are contributed by the consumers segment and the rest 40% is from the business. The company is optimistic that the sales in the consumer segment would pick up, supported by continued momentum in small and medium enterprise refresh. The recent softening in demand of tablets further strengthens Intel’s optimism.

Summarizing the results, Intel closed the second quarter with $2.8 billion net income that is $0.55 per share, in comparison to $2 billion or $0.39 per share during the previous year. The revenues too scaled higher by 8% to $13.83 billion. Following the news, the shares of the company jumped by nearly 5% to $33.25, its 15-year high.

Disclosure: none

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