Intel Corp. ’s upcoming earnings report is expected to be a busy one as the chipmaker discusses trends in the personal computing and data center markets, as well as emerging opportunities in artificial intelligence.
After the closing bell on Thursday, the results came as Intel stock.
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The company has enjoyed a rapid move of more than 50% since it last presented its numbers to Wall Street.
Read: Missed the boat on AMD’s stock surge? Why does this analyst say you’re not late?
HSBC analyst Frank Lee wrote in a recent report that the rally has “extended the ban on expectations.”
“We recognized Intel’s improved performance and improved market share, particularly on its PC client side,” Lee continued, and he believes the company’s Revenue and gross margins will fall roughly in line with consensus estimates for the latest period.
At the same time, he sees “little room for further gains in the near term” given the stock’s recent expansion in price-to-earnings multiples.
What to look for in fourth quarter numbers
Don’t miss: Intel’s ‘make or break year’ will test the stock’s recent rally.
What to expect
Income: The FactSet consensus calls for adjusted earnings of 45 cents per share in the fourth quarter, compared with 10 cents in the year-earlier period.
Income: Analysts tracked by FactSet expected Intel to post revenue of $15.2 billion for the fourth quarter, compared with $14.0 billion in the year-ago quarter.
Consensus estimates called for a 28 percent increase in revenue for Intel’s client computing unit, to $8.5 billion, its largest. Data center and AI revenue is forecast to decline nearly 5 percent to $4.1 billion.
Stock Movement: Shares of Intel have risen after each of the company’s past three earnings reports, including when they rose 9% after the most recent report. The stock is up 68% over the past 12 months, and 52% over the past three months.
Of the 42 analysts that cover Intel stock tracked by FactSet, nine have a buy rating, 27% have a hold rating, and six have a sell rating, with an average price at $44.04, which is about 12% below recent levels.
And what to expect.
Watch the company’s commentary on HSBC’s PC business. “In particular, we believe there may be some downside risk to accelerating consensus expectations for its PC client sales. [$7.7 billion] Based on recent weakness in the overall PC supply chain,” he wrote.
Executives can discuss the market for AI PCs, which Intel is betting on.
“For PC [total addressable market] Out of reach [the fourth quarter]we see the introduction of AI PCs with the recent debut of Meteor Lake (followed by Arrow Lake, Lunar Lake, and Panther Lake as follow-ons in 2025) as well-positioned, as client-side inference workloads grow in importance. has been,” wrote TD Cowen’s Matthew Ramsey.
As for AI in general, Bernstein’s Stacey Rasgan said this is the year investors will start to see “is there really something behind a company’s AI narrative?”
“At this point it still looks incremental (at best); the company suggests [roughly $2 billion] I [the] Gaudi pipeline, but we still have no real idea of how much of that pipeline there is, or really anything on time (and $2B is small for Intel’s size),” he continued.
Meanwhile, Wolfe Research analyst Chris Caso said he saw some risk potential for Intel’s first-quarter data, “although it’s more about bad modeling than bad conditions.”
See also: Nvidia is no longer Morgan Stanley’s top chip pick. A very different name.