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Intel Reports Fifth Consecutive Quarter of Record Revenue

All Business Segments Report Double-Digit Revenue Growth Year-over-Year

Non-GAAP Results • Revenue: A record $13.1 billion, up $2.3 billion, 22 percent year-over-year • Gross margin: 62 percent, down 5.5 percentage points year-over-year • Operating income: $4.2 billion, up $221 million, 6 percent year-over-year • Net income: $3.2 billion, up $290 million, 10 percent year-over-year • EPS: 59 cents, up 8 cents, 16 percent year-over-year GAAP Results • Revenue: A record $13.0 billion, up $2.3 billion, 21 percent year-over-year • Gross margin: 61 percent, down 6.6 percentage points year-over-year • Operating income: $3.9 billion, down $46 million, 1 percent year-over-year • Net income: $3.0 billion, up $67 million, 2 percent year-over-year • EPS: 54 cents, up 3 cents, 6 percent year-over-year SANTA CLARA, Calif., July 20, 2011 – Intel Corporation today reported its fifth consecutive quarter of record revenue, with double-digit revenue growth across all business segments. On a Non-GAAP basis, revenue was $13.1 billion, operating income was $4.2 billion, net income was $3.2 billion, and EPS was 59 cents. On a GAAP basis, the company reported second-quarter revenue of $13.0 billion, operating income of $3.9 billion, net income of $3.0 billion, and EPS of 54 cents. The company generated approximately $4.0 billion in cash from operations, paid cash dividends of $961 million, and used $2.0 billion to repurchase 93 million shares of common stock. “We achieved a significant new milestone in the second quarter, surpassing $13.0 billion in revenue for the first time,” said Paul Otellini, Intel president and CEO. “Strong corporate demand for our most advanced technology, the surge of mobile devices and Internet traffic fueling data center growth, and the rapid rise of computing in emerging markets drove record results. Intel’s 23 percent revenue growth in the first half and our increasing confidence in the second half of 2011 position us to grow annual revenue in the mid-20 percent range.” Non-GAAP Financial Comparison Quarterly Results Q2 2011 vs. Q1 2011 vs. Q2 2010 Revenue $13.1 billion up 2% up 22% Operating Income $4.2 billion down 2% up 6% Net Income $3.2 billion down 3% up 10% Earnings Per Share 59 cents flat up 16% Non-GAAP results exclude certain acquisition accounting impacts and expenses related to acquisitions and the related income tax effects of these charges. GAAP Financial Comparison Quarterly Results Q2 2011 vs. Q1 2011 vs. Q2 2010 Revenue $13.0 billion up 1% up 21% Operating Income $3.9 billion down 5% down 1% Net Income $3.0 billion down 7% up 2% Earnings Per Share 54 cents down 4% up 6% Q2 2011 Key Financial Information (GAAP) • Business unit trends: o PC Client Group revenue up 11 percent year-over-year. o Data Center Group revenue up 15 percent year-over-year. o Other Intel architecture group revenue up 84 percent year-over-year, including Embedded & Communications Group revenue up 25 percent year-over-year. o Intel® Atom™ microprocessor and chipset revenue of $352 million, down 15 percent year-over-year. • The acquisitions of McAfee Inc. and Infineon Wireless Solutions (now Intel Mobile Communications) contributed revenue of $1.0 billion in their first full-quarter of results. • The platform average selling price (ASP) was approximately flat sequentially and up year-over-year. • Gross margin was 61 percent, consistent with the company’s expectation. • R&D plus MG&A spending was $3.9 billion, consistent with the company’s expectation. • Net loss of $4 million from equity investments and interest and other, versus the company’s expectation of a $50 million net gain. • The effective tax rate was 25 percent, below the company’s expectation of 29 percent. • The company used $2.0 billion to repurchase 93 million shares of common stock. • The second quarter of 2011 had 13 weeks of business, while the first quarter of 2011 had 14 weeks. Business Outlook Intel’s Business Outlook does not include the potential impact of any mergers, acquisitions, divestitures or other business combinations that may be completed after July 20. Q3 2011 (GAAP, unless otherwise stated) • Revenue: $14.0 billion, plus or minus $500 million. • Non-GAAP revenue: $14.1 billion, plus or minus $500 million, excluding certain acquisition-related accounting impacts. • Gross margin percentage: 64 percent, plus or minus a couple percentage points. • Non-GAAP gross margin percentage: 65 percent plus or minus a couple percentage points, excluding certain accounting impacts and expenses related to acquisitions. • R&D plus MG&A spending: approximately $4.3 billion. • Amortization of acquisition-related intangibles: approximately $75 million. • Impact of equity investments and interest and other: gain of approximately $100 million. • Depreciation: approximately $1.3 billion. Full-Year 2011 (GAAP, unless otherwise stated) • Gross margin percentage: 63 percent, plus or minus a couple percentage points, unchanged. • Non-GAAP gross margin percentage: 64 percent, plus or minus a couple percentage points, excluding certain accounting impacts and expenses related to acquisitions, unchanged. • Spending (R&D plus MG&A): $16.2 billion, plus or minus $200 million, up from the company’s previous expectation of $15.7 billion, plus or minus $200 million. • Amortization of acquisition-related intangibles: approximately $260 million, unchanged. • Tax rate: approximately 28 percent for the third and fourth quarters, below the company’s previous expectation of 29 percent. • Depreciation: $5.2 billion, plus or minus $100 million, up from the company’s previous expectation of $5.0 billion, plus or minus $100 million. • Capital spending: $10.5 billion, plus or minus $400 million, up from the company’s previous expectation of $10.2 billion, plus or minus $400 million. • 2011 will have 53 weeks of business versus the typical 52 weeks. For additional information regarding Intel’s results and Business Outlook, please see the CFO commentary at: www.intc.com/results.cfm. Earnings Webcast Intel will hold a public webcast at 2:30 p.m. PDT today on its Investor Relations web-site at www.intc.com. A webcast replay and MP3 download will also be made available on the site. Intel plans to report its earnings for the third quarter of 2011 on Tuesday, Oct. 18, 2011. Immediately following the earnings report, the company plans to publish a commentary by Stacy J. Smith, vice president and chief financial officer at www.intc.com/results.cfm. A public webcast of Intel’s earnings conference call will follow at 2:30 p.m. PDT at www.intc.com. About Intel Intel (NASDAQ: INTC) is a world leader in computing innovation. The company designs and builds the essential technologies that serve as the foundation for the world’s computing devices. Additional information about Intel is available at newsroom.intel.com and blogs.intel.com.