Intel drops 4% despite Q4 results beating expectations
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Intel (NASDAQ:INTC) shares fell despite the chip giant posting fourth-quarter earnings that topped expectations.
For the period ending December 25, Intel said it earned $1.09 a share on $19.53 billion in revenue. A consensus of Wall Street analysts expected the company to earn 79 cents a share on $18.36 billion in revenue.
The revenue strength was led by Intel's Data Center Group, which generated $7.3 billion in sales, up 20% year-over-year. Its Internet of Things Group, which includes Mobileye, also saw a rise, with the IOTG group up 36% year-over-year to $1.1 billion and Mobileye rising 7% to $356 million over the same time frame. Intel's Client Computing Group generated $10.1 billion, down 7% year-over-year.
For the first quarter, Intel said it expects to earn an adjusted 80 cents per share on revenue of $18.3 billion, compared to expectations of 77 cents a share and $17.63 billion in revenue.
Gross margins, a closely watched measure for semiconductor companies, fell 3.2% to 53.6%, down from 56.8% in the year-ago period.
The company also raised its dividend 5% to $1.46 per share on an annual basis.
In a statement, Chief Executive Pat Gelsinger said: âOur disciplined focus on execution across technology development, manufacturing, and our traditional and emerging businesses is reflected in our results. We remain committed to driving long-term, sustainable growth as we relentlessly execute our IDM 2.0 strategy.â
Following the results, Intel (INTC) shares fell more than 3% to $49.81.
The company will hold a conference call at 5 p.m. EST to discuss the fourth-quarter results and first-quarter guidance.
Earlier on Wednesday, Intel (INTC) won an appeal on a $1.2 billion fine that was placed on it in 2009 by the European Union's antitrust regulator after the EU's General Court said the analysis the regulator carried out was "incomplete."