In its third-quarter earnings report, Intel reported adjusted earnings per share of 52 cents, surpassing the expected 40 cents, and revenue of $16.51 billion, slightly below the anticipated $16.5 billion. While overall revenue increased by 21% year-over-year, the company's client computing and physical AI group saw a 5% decline to $8.1 billion, missing estimates.
Conversely, revenue from data center and AI surged by 78% to $7.3 billion. Looking ahead, Intel forecasts adjusted earnings per share of 25 cents and revenue between $15 billion and $16 billion, falling short of analyst expectations for $17.1 billion in revenue and 43 cents in EPS.
Intel's finance chief, David Zinsner, indicated that the PC market slowdown is likely to continue through at least the first half of next year, although he remains optimistic about the company's broader portfolio.
Despite a strong performance earlier in the year, with shares up about 150%, Intel's stock has declined approximately 23% in October amid concerns regarding the artificial intelligence sector's growth. CEO Lip-Bu Tan noted robust long-term demand for CPUs despite short-term challenges in the PC industry.
Intel's foundry business is also facing difficulties, but it is in high-volume production of its advanced 18A chip, which could attract major fabless chip customers. Recent investments from the Trump administration, Nvidia, and Softbank highlight the strategic importance of Intel's technology.
Additionally, Oracle announced an expanded partnership with Intel to utilize its next-generation Xeon server processors, further emphasizing the demand for data center capacity amid the AI boom