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Intel Beats Forecasts - Revenue Hits All Time Record

October 26, 2018

Intel  reported third-quarter 2018 financial results. Third-quarter revenue of $19.2 billion was an all-time record, up 19 percent YoY driven by broad business strength and customer preference for performance-leading products. The Client Computing Group (CCG), the Data Center Group (DCG), the Internet of Things Group (IOTG), the Non-volatile Memory Solutions Group (NSG) and Mobileye all achieved record revenue. Collectively, data-centric businesses grew 22 percent, led by 26 percent YoY growth in DCG. PC-centric revenue was up 16 percent on continued strength in the commercial and gaming segments. Excellent operating margin leverage and a lower tax rate drove record quarterly EPS.

Investors were only looking for $18.11 billion in revenue. Intel reported earnings $1.40 per share against the $1.15 per share that was expected.

“Stronger than expected customer demand across our PC and data-centric businesses continued in the third quarter. This drove record revenue and another raise to our full-year outlook, which is now up more than six billion dollars from our January expectations. We are thrilled that in a highly competitive market, customers continue to choose Intel,” said Bob Swan, Intel CFO and Interim CEO. “In the fourth quarter, we remain focused on the challenge of supplying the incredible market demand for Intel products to support our customers' growth. We expect 2018 will be another record year for Intel, and our transformation positions us to win share in an expanded $300 billion1 total addressable market.”

In the third quarter, Intel achieved growth in every business segment. The PC-centric business (CCG) delivered record revenue, up 16 percent on continued strong demand for Intel's performance-leading products and strength in commercial and gaming. CCG launched new U and Y-series 8th Gen Intel Core processors enabling faster connectivity speeds, better performance and longer battery life for thin, light laptops and 2 in 1 devices. We also recently introduced the Intel Core i9-9900K processor, the world’s best gaming processor.

Collectively, Intel's data-centric businesses grew 22 percent YoY led by 26 percent growth in the Data Center Group (DCG). DCG achieved record quarterly revenue driven by strong demand from cloud and communications service providers investing to meet the explosive demand for data and to improve the performance of data-intensive workloads like artificial intelligence. In Q3, DCG shipped the first Intel Optane DC Persistent Memory for revenue, and Intel Xeon Scalable set 95 new performance world records2 as adoption continued.
The Internet of Things Group (IOTG) also achieved record revenue. Excluding Wind River, which Intel divested in the second quarter, IOTG revenue was up 19 percent YoY on broad business strength. Record revenue in Intel's memory business (NSG) was up 21 percent YoY.

Intel's Programmable Solutions Group (PSG) revenue grew 6 percent YoY with continued strength in the data center and strong organic growth. PSG expanded its product line with the acquisition of eASIC and the introduction of the new Intel® Programmable Acceleration Card (PAC) with Intel® Stratix® 10 SX FPGA.

Mobileye also achieved record quarterly revenue of $191 million, up approximately 50 percent YoY3 as customer momentum continued. Mobileye won 8 new design at major US and global automakers in Q3, bringing its year-to-date design win total to 20.

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