There is no peace for “made in the USA” technology. After the run-up to cut costs and lay off staff by the giants of the Internet, now it is the accounts that populate investors’ nightmares. A cross-section was given yesterday by Intel, the microchip giant who finds himself with feet of clay. The fact is that it disappoints expectations on the 2022 accounts and raises an alarm on profits also for the first quarter of this year both on the PC market front, which is paying for the slowdown after the pandemic boom, and on the important one of data center, as competition gets fiercer. “We stumbled, lost momentum. We think it will stabilize this year,” CEO Pat Gelsinger told alarmed investors on a conference call. But that is not enough to reassure the market.
And give
Fourth-quarter numbers see adjusted earnings per share up 10 cents, versus estimates for 21 cents, revenues stopped at $14 billion, less than the $14.49 billion analysts’ average was expecting.
But the comparison is even more merciless when compared with a year earlier, when Intel had recorded a profit of 1.15 dollars per share (the drop is therefore equal to 92%) on revenues of 19.5 billion (minus 28%). 2022 ended with revenue of $63.1 billion, down 16% from a year earlier, while adjusted earnings fell 65% to $1.84 billion. Even in terms of expectations, Intel disappoints the market: for the first quarter of 2023, it expects revenues between 10.5 and 11.5 billion dollars, against market estimates of 13.96 billion, with a loss of 15 cents per share, against estimates for a profit of 25 cents. A disaster, which on the Nasdaq translates into a slide of up to 10% to improve at the close, to -6.4%. For the market, these are horror numbers. “There are no results, it’s a crime scene,” analysts commented to the US press.
Yellow on Italy
Intel explains that it has rationalized investments, “prioritizing the areas where we can have the greatest value in the long term,” said CFO David Zinsner. Will there be changes in investment in Europe? Already in Davos, CEO Gelsinger had been cryptic about the expected commitment in Italy. Now, with the need to save money, the question marks are mounting.