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Will Sharp Top-Line Contraction Mar Intel (INTC) Q1 Earnings?
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Intel Corporation (INTC - Free Report) is scheduled to report first-quarter 2023 results on Apr 27 after the closing bell. In the last reported quarter, the company delivered a negative earnings surprise of 50%. The Santa Clara, CA-based semiconductor company is expected to have recorded year-over-year lower revenues due to a fall in sales in the Client Computing Group (CCG) and Datacenter and AI Group (DCAI).
Factors at Play
In the first quarter, Intel unveiled the 4th-Generation Intel Xeon Scalable processors, Intel Xeon CPU Max Series and Intel Data Center GPU Max Series, in a concerted effort to bring the company to the forefront of the processor market amid intense competitive pressure. Code-named Sapphire Rapids, the 4th Gen Xeon Scalable processor is designed to solve computing challenges at scale with built-in accelerators optimized for specific workloads that deliver increased performance at higher efficiency for an optimal total cost of ownership (TCO).
Intel also launched the 13th Gen Intel Core mobile processor for superior performance. The company introduced Quantum Software Development Kit (SDK) Version 1.0 to help developers learn how to create quantum algorithms and applications. SDK version 1.0 interface is based on C++, allowing seamless collaboration between classical computing developers and quantum developers. It is a full quantum computer in simulation with a quantum runtime environment optimized for executing hybrid quantum-classical algorithms. These are likely to get reflected in the upcoming results.
However, dwindling PC sales, supply chain adversities and an uncertain macroeconomic environment are likely to have weighed on the company’s top-line performance. In addition, Intel is witnessing intensifying competition in the server, storage and networking markets.
For the March quarter, the Zacks Consensus Estimate for total revenues is pegged at $11,054 million, which indicates a significant decline from the year-ago quarter’s reported figure of $18,353 million. The Zacks Consensus Estimate for revenues from the DCAI segment is pegged at $3,456 million, indicating a decline from $6,034 million reported in the year-ago quarter. The Zacks Consensus Estimate for revenues from the CCG segment stands at $4,919 million, implying a decrease from $9,294 million reported in the year-ago quarter. The consensus estimate for adjusted loss per share stands at 16 cents, suggesting a sharp fall from earnings of 87 cents reported in the prior year.
Earnings Whispers
Our proven model does not predict an earnings beat for Intel this time around. 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 -3.01%. 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 Corning Incorporated (GLW - Free Report) is +3.71% and it carries a Zacks Rank of 3. The company is scheduled to report quarterly numbers on Apr 25.
The Earnings ESP for Meta Platforms, Inc. (META - Free Report) is +11.23% and it sports a Zacks Rank of 1. The company is scheduled to report quarterly numbers on Apr 26.
Image: Bigstock
Will Sharp Top-Line Contraction Mar Intel (INTC) Q1 Earnings?
Intel Corporation (INTC - Free Report) is scheduled to report first-quarter 2023 results on Apr 27 after the closing bell. In the last reported quarter, the company delivered a negative earnings surprise of 50%. The Santa Clara, CA-based semiconductor company is expected to have recorded year-over-year lower revenues due to a fall in sales in the Client Computing Group (CCG) and Datacenter and AI Group (DCAI).
Factors at Play
In the first quarter, Intel unveiled the 4th-Generation Intel Xeon Scalable processors, Intel Xeon CPU Max Series and Intel Data Center GPU Max Series, in a concerted effort to bring the company to the forefront of the processor market amid intense competitive pressure. Code-named Sapphire Rapids, the 4th Gen Xeon Scalable processor is designed to solve computing challenges at scale with built-in accelerators optimized for specific workloads that deliver increased performance at higher efficiency for an optimal total cost of ownership (TCO).
Intel also launched the 13th Gen Intel Core mobile processor for superior performance. The company introduced Quantum Software Development Kit (SDK) Version 1.0 to help developers learn how to create quantum algorithms and applications. SDK version 1.0 interface is based on C++, allowing seamless collaboration between classical computing developers and quantum developers. It is a full quantum computer in simulation with a quantum runtime environment optimized for executing hybrid quantum-classical algorithms. These are likely to get reflected in the upcoming results.
However, dwindling PC sales, supply chain adversities and an uncertain macroeconomic environment are likely to have weighed on the company’s top-line performance. In addition, Intel is witnessing intensifying competition in the server, storage and networking markets.
For the March quarter, the Zacks Consensus Estimate for total revenues is pegged at $11,054 million, which indicates a significant decline from the year-ago quarter’s reported figure of $18,353 million. The Zacks Consensus Estimate for revenues from the DCAI segment is pegged at $3,456 million, indicating a decline from $6,034 million reported in the year-ago quarter. The Zacks Consensus Estimate for revenues from the CCG segment stands at $4,919 million, implying a decrease from $9,294 million reported in the year-ago quarter. The consensus estimate for adjusted loss per share stands at 16 cents, suggesting a sharp fall from earnings of 87 cents reported in the prior year.
Earnings Whispers
Our proven model does not predict an earnings beat for Intel this time around. 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 -3.01%. 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 currently 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:
Skyworks Solutions, Inc. (SWKS - Free Report) is set to release quarterly numbers on May 8. It has an Earnings ESP of +0.15% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Earnings ESP for Corning Incorporated (GLW - Free Report) is +3.71% and it carries a Zacks Rank of 3. The company is scheduled to report quarterly numbers on Apr 25.
The Earnings ESP for Meta Platforms, Inc. (META - Free Report) is +11.23% and it sports a Zacks Rank of 1. The company is scheduled to report quarterly numbers on Apr 26.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.