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Will Soft Processor Revenues Dent Intel (INTC) Q1 Earnings?
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Intel Corporation (INTC - Free Report) is scheduled to report first-quarter 2022 results after the closing bell on Apr 28. In the first quarter, the company is likely to have recorded lower revenues from the Client Computing Group (“CCG”) segment due to challenging macroeconomic conditions and cheaper alternatives available from rival firms.
Factors at Play
CCG is the company’s largest segment and accounts for the lion’s share of total revenues. It includes computer CPUs, several server boards and form factor systems and graphic products.
In the to-be-reported quarter, Intel introduced the vPro platform with 12th Gen Intel Core processors for business productivity. The latest platform provides the highest performance and most comprehensive security for businesses of all sizes. Intel vPro delivers a wide array of computing solutions, which cater to nearly every type of worker at any business.
During the quarter, Intel announced the completion of the first phase of the sale of its NAND and SSD Business to Seoul-based SK Hynix. The first transaction includes the sale of its SSD business and the transfer of certain NAND and SSD-related intellectual property, employees and the Dalian NAND memory manufacturing facility in China. Intel’s sale of its manufacturing facility in China is in accordance with its long-term strategic goals. The company is gradually reducing its dependence on the PC-centric business by transitioning into data-centric businesses such as AI and autonomous driving. The divestitures are likely to have contracted the revenue base on a year-over-year basis.
Moreover, continued ramp down from the exit of 5G smartphone modem and Home Gateway Platform businesses is likely to have resulted in lower revenues for the segment. In addition, the prolonged Ukraine-Russia war has hampered the company's operations, and it has exited the Russian market owing to U.S. sanctions. This is likely to have led to top-line contraction and increased pricing pressure. It might limit margin expansion in the near term.
Overall Expectations
The Zacks Consensus Estimate for revenues from the CCG segment is pegged at $9,335 million, indicating a significant decline from $10,605 million reported in the year-ago quarter.
The Zacks Consensus Estimate for total revenues of the company stands at $18,320 million, indicating a decline from $19,673 million reported in the prior-year quarter. The consensus mark for earnings is currently pegged at 80 cents per share. It had reported $1.39 in the year-earlier quarter.
Earnings Whispers
Our proven model does not predict an earnings beat for Intel for the first quarter. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here.
Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Here are some companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this season:
The Earnings ESP for T-Mobile US, Inc. (TMUS - Free Report) is +75.17% and it carries a Zacks Rank of 3. The company is set to report quarterly numbers on Apr 27.
The Earnings ESP for Telephone and Data Systems, Inc. (TDS - Free Report) is +34.62% and it carries a Zacks Rank of 3. The company is scheduled to report quarterly numbers on May 5.
Image: Bigstock
Will Soft Processor Revenues Dent Intel (INTC) Q1 Earnings?
Intel Corporation (INTC - Free Report) is scheduled to report first-quarter 2022 results after the closing bell on Apr 28. In the first quarter, the company is likely to have recorded lower revenues from the Client Computing Group (“CCG”) segment due to challenging macroeconomic conditions and cheaper alternatives available from rival firms.
Factors at Play
CCG is the company’s largest segment and accounts for the lion’s share of total revenues. It includes computer CPUs, several server boards and form factor systems and graphic products.
In the to-be-reported quarter, Intel introduced the vPro platform with 12th Gen Intel Core processors for business productivity. The latest platform provides the highest performance and most comprehensive security for businesses of all sizes. Intel vPro delivers a wide array of computing solutions, which cater to nearly every type of worker at any business.
During the quarter, Intel announced the completion of the first phase of the sale of its NAND and SSD Business to Seoul-based SK Hynix. The first transaction includes the sale of its SSD business and the transfer of certain NAND and SSD-related intellectual property, employees and the Dalian NAND memory manufacturing facility in China. Intel’s sale of its manufacturing facility in China is in accordance with its long-term strategic goals. The company is gradually reducing its dependence on the PC-centric business by transitioning into data-centric businesses such as AI and autonomous driving. The divestitures are likely to have contracted the revenue base on a year-over-year basis.
Moreover, continued ramp down from the exit of 5G smartphone modem and Home Gateway Platform businesses is likely to have resulted in lower revenues for the segment. In addition, the prolonged Ukraine-Russia war has hampered the company's operations, and it has exited the Russian market owing to U.S. sanctions. This is likely to have led to top-line contraction and increased pricing pressure. It might limit margin expansion in the near term.
Overall Expectations
The Zacks Consensus Estimate for revenues from the CCG segment is pegged at $9,335 million, indicating a significant decline from $10,605 million reported in the year-ago quarter.
The Zacks Consensus Estimate for total revenues of the company stands at $18,320 million, indicating a decline from $19,673 million reported in the prior-year quarter. The consensus mark for earnings is currently pegged at 80 cents per share. It had reported $1.39 in the year-earlier quarter.
Earnings Whispers
Our proven model does not predict an earnings beat for Intel for the first quarter. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here.
Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Intel Corporation Price and EPS Surprise
Intel Corporation price-eps-surprise | Intel Corporation Quote
Zacks Rank: Intel has a Zacks Rank #3.
Stocks to Consider
Here are some companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this season:
Amazon.com, Inc. (AMZN - Free Report) is set to release quarterly numbers on Apr 28. It has an Earnings ESP of +8.30% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Earnings ESP for T-Mobile US, Inc. (TMUS - Free Report) is +75.17% and it carries a Zacks Rank of 3. The company is set to report quarterly numbers on Apr 27.
The Earnings ESP for Telephone and Data Systems, Inc. (TDS - Free Report) is +34.62% and it carries a Zacks Rank of 3. The company is scheduled to report quarterly numbers on May 5.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.