Intel beats Q2 estimates as AI demand drives 25 pc revenue growth: Report
New Delhi, July 27
Chipmaker Intel reported stronger-than-expected second-quarter results, with revenue rising 25 per cent year-on-year, driven by robust demand for artificial intelligence-powered computing, data centre processors and foundry services, a report has said.
As per analysis of the Vietnam Times, the company posted revenue of $16.1 billion for the quarter ended June, up from $12.9 billion a year earlier and ahead of its own guidance as well as analysts' expectations of around $15.1 billion.
On a non-GAAP basis, Intel reported net income of $2.2 billion or 42 cents per share, compared with a loss of $400 million in the year-ago period, it added.
However, on a GAAP basis, the company posted a net loss of $11 billion, wider than the $2.9 billion loss reported a year earlier.
According to Intel, its server business recorded its strongest year-on-year growth on record, with the Xeon 6 processor emerging as one of the fastest-ramping products in the company's history amid rising enterprise demand for AI workloads.
"AI is driving unprecedented demand for compute, and as we continue to execute, Intel is well-positioned to capture sustainable growth across our CPU franchise, ASICs, advanced packaging and wafer foundry network," Intel CEO Lip-Bu Tan said.
The company said its Intel Foundry business also made significant progress during the quarter, with its Intel 18A-P process entering risk production, strengthening its position to attract external chip customers.
To support future AI-driven demand, Intel said it is increasing investments in manufacturing equipment, clean-room capacity and semiconductor substrates.
The company also announced a 5 billion euro investment to expand production capacity for its Xeon processors and next-generation chips.
In addition, Intel ended the quarter with nearly $30 billion in cash and total liquidity of about $40 billion.
— IANS
Reader Comments
$11 billion GAAP loss is concerning despite the AI hype. As an investor, I'd ask - is this growth sustainable or just a sugar rush from AI spending? Need to see real profitability before jumping in.
This is good news for Indian IT services companies too. More AI chips = more demand for our cloud and data center players. But we must ask - are we building enough domestic capacity or just consuming imported tech?
Interesting how they highlight non-GAAP profit but hide the GAAP loss. As a Chartered Accountant, I always tell my clients: look at the full picture. 5 billion euro investment in Europe is bold but will it benefit Indian semiconductor plans? 🤔
$40 billion in liquidity is massive. Intel can weather storms. But as a tech enthusiast in Bengaluru, I wonder when we'll see Indian-made chips competing with Xeon. Our talent is world-class but policy execution needs to catch up.
The GAAP loss vs. non-GAAP profit thing is standard tech accounting. What matters is cash flow. With $30B cash on hand, Intel can keep investing. India should look at this and ask: where's our homegrown chip champion?
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