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Intel (INTC) Reports In-Line Q1 EPS; Trims FY15 Revenue Outlook

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April 14, 2015 4:01 PM EDT

(Updated - April 14, 2015 4:03 PM EDT)

Intel (NASDAQ: INTC) reported Q1 EPS of $0.41, in-line with the analyst estimate of $0.41. Revenue for the quarter came in at $12.8 billion versus the consensus estimate of $12.9 billion.

Q1 Key Business Unit Trends
•
Client Computing Group revenue of $7.4 billion, down 16 percent sequentially and down 8 percent year-over-year.
•
Data Center Group revenue of $3.7 billion, down 10 percent sequentially and up 19 percent year-over-year.
•
Internet of Things Group revenue of $533 million, down 10 percent sequentially and up 11 percent year-over-year.
•
Software and services operating segments revenue of $534 million, down 4 percent sequentially and down 3 percent year-over-year.

2015 Outlook

The Outlook for full year 2015 does not include the effect of any acquisitions, divestitures or similar
transactions that may be completed after April 14. The midpoint of the forecast ranges will be referred to
when making comparisons to specific periods.

Revenue

Revenue for the year is expected to be approximately flat to 2014, down from our previous expectation.

Gross Margin

Gross margin for the year is expected to be 61%, plus or minus a couple points, down 1.0 point from our
previous Outlook of 62%. The decrease is a result of higher platform* unit costs on lower utilization and
increased mix to server, and lower platform* volumes. This is partially offset by higher platform* average
selling prices and lower factory start-up costs on 14nm.

Spending

Spending for R&D and MG&A for the year is expected to be approximately $19.7B plus or minus
$400M, down $300M from our previous expectation of $20.0B plus or minus $400M.

Depreciation is forecast to be approximately $8.0B plus or minus $100M, down $100M from our previous
expectation of $8.1B plus or minus $100M.

Amortization of acquisition-related intangibles is forecast to be approximately $250M roughly flat to our
previous expectation of $255M.

Other Income Statement Items

The tax rate for each of the third and fourth quarters is expected to be 25%, down from our previous
expectation of 27%.

Balance Sheet and Cash Flow Items

Capital spending for 2015 is expected to be $8.7B plus or minus $500M, down $1.3B, from our previous
expectation of $10.0B plus or minus $500M. The reduction is driven by increased reuse of capital on
14nm and the alignment of capacity with demand.

For earnings history and earnings-related data on Intel (INTC) click here.


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