Intel Corporation (INTC) reports weak third-quarter earnings figures, driven by an industry-wide component shortage for its PC chip business leading to a 2% shrinkage during the quarter ended October 2.
Intel also warned that its cash flow and gross margin to go down over the next few years as it invests in new chip factories, and in research and development. Intel expects $18.3 billion in adjusted sales in the fourth quarter, in comparison to analysts’ expectations of $18.24 billion.
- Intel’s client computing group, its largest business, was down 2% year-over-year to $9.7 billion, it includes PC chip revenue.
- Intel’s Data Center Group, which sells processors and other silicon for data centers, produced $6.5 billion in sales, an increase of 10% year-over-year, but short of analyst estimates of $6.66 billion.
- The chip giant’s gross margin during the third quarter was 56%, up 2.9% year-over-year.
- The company witnessed growth in its internet of things group, a 54% increase to $1 billion, and Mobileye, its automotive chip subsidiary, also grew 39% to $326 million.
- The company informed extensive capital expenditure as it spends $20 billion this year, including its new Arizona semiconductor factory.
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