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Intel reports its Q1 2023 financial results

by on28 April 2023

All businesses report a major drop in revenue

Intel has released its first-quarter 2023 financial results, reporting a loss across all of its key businesses, with client and data center reporting a drop of 38 and 39 percent, respectively. The reported revenue is 11.7 billion, down by 26 percent compared to the same quarter last year.

With revenue of $11.7 billion, Intel is definitely not doing good, as this is a major drop compared to the same quarter last year. The reported gross margin of 34.2 percent is down by 16.2 points, and the operating margin is at 1.25 percent, also down by 36.2 points. The R&D and MG&A funds are at $5.4 billion, down by 11 percent compared to the last year.

Intel also reported a net loss of $2.8 billion, which is lower compared to the same quarter last year, hitting $8.1 billion. Earnings per share, or to be precise, loss per share, is also down to $0.66, from $1.98.

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Despite a grim Q1 2023 report, Pat Gelsinger, Intel CEO, is saying that this is a solid first-quarter result, and, it does show steady progress. On the other hand, the company is still reporting losses, and it is far from looking good.

We delivered solid first-quarter results, representing steady progress with our transformation," said Pat Gelsinger, Intel CEO. "We hit key execution milestones in our data center roadmap and demonstrated the health of the process technology underpinning it. While we remain cautious on the macroeconomic outlook, we are focused on what we can control as we deliver on IDM 2.0: driving consistent execution across process and product roadmaps and advancing our foundry business to best position us to capitalize on the $1 trillion market opportunity ahead."

David Zinsner, Intel CFO, said, "We exceeded our first-quarter expectations on the top and bottom line, and continued to be disciplined on expense management as part of our commitment to drive efficiencies and cost savings. At the same time, we are prioritizing the investments needed to advance our strategy and establish an internal foundry model, one of the most consequential steps we are taking to deliver on IDM 2.0."

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All of Intel's key businesses are reporting a drop in revenue, and only Mobileye is up by 16 percent, and we are talking about revenue of $458 million. The Data Center and AI (DCAI) reported revenue of $3.7 billion, a 39 percent drop compared to the same quarter last year. Client Computing Group (CCG) hit $5.8 billion, down by 38 percent, and Intel Foundry Services (IFS) are down 24 percent with revenue of $118 million.

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As noted by Pat Gelsinger, Intel is on track to deliver on its IDM 2.0 plan, and the company says its chips are still on track, with Intel 7 is in high-volume manufacturing and CCG's Meteor Lake product on Intel 4 is ramping production wafer starts for an expected launch in the second half of 2023. Intel 3, Intel 20A, and Intel 18A are also on track.

Intel expects pretty similar results for its Q2 2023 financial report, with revenue of $11.5 to $12.5 billion, and gross margin going down to 33.2 percent.


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